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Late to join the Sensex, Nifty party? These balanced funds offer great returns for first-time investors

At this juncture when the market may have just seen the maximum upward move, investors especially the first-time equity investors will find it difficult to pump their money into stocks, expecting decent returns.

Aseem Thapliyal        Last Updated: August 4, 2017  | 09:57 IST
Late to join the Sensex, Nifty party? These balanced funds offer decent returns for first-time investors

The market is hovering near all-time highs, which makes it difficult to guess which side the tide will turn for investors.

The Sensex and Nifty have seen a spectacular rally during the past six months.

While the Nifty rose 15.78 percent or 1375 points, the Sensex gained 15.56 percent during the last six months.  

Since the beginning of this year, the Sensex has gained 23.29 percent or 1,906 points and the Nifty has seen a 22.14 percent or 5,894.1 points upward move.

Also read: Five tax-saving schemes that may fetch you great returns

At this juncture when the market may have just seen the maximum upward move, investors especially the first-time equity investors will find it difficult to pump their money into stocks, expecting decent returns.

Hence, the role of balanced funds comes into play as they invest in stocks while keeping the risk low These funds, also called hybrid equity-oriented funds, are a good choice for those new to equities and first-time investors.

Fund managers invest around 65 per cent of their portfolio in equities and the rest in debt securities, which allows them to give tax-free returns after one year of investment. These funds are not risk free but lesser volatile than diversified funds.

We look at top five balanced funds (according to Morningstar) which have given maximum returns in recent times.

Tata Retirement Savings Fund

The hybrid-equity oriented fund had assets worth Rs 151 crore on June 30, 2017. Its expense ratio was 2.79 percent. The fund was launched on November 1, 2011 and has returned 19.24 percent since then.

The open-ended fund has 3  percent exit load if you redeem it before attaining the age of 60 years.

The fund has given 26.70 percent return on an year-to-date basis.  The fund's returns are benchmarked against Crisil Balanced Fund Aggressive  index. For the last six months preceding June 15, 2017, the fund gave 22.80 percent, 26.68 percent,  20.66  percent and 20.32 percent returns in six months, one year, three years and five years, respectively.

L&T India Prudence  fund

The fund had assets worth Rs 5,168 crore on June 30, 2017. Its expense ratio was 2.02 percent. The fund was launched on January 31, 2011 and has returned 15.39 percent since then.

The open-ended fund has 1 percent exit load for redemption within 365 days for units in excess of 10 percent of the investment.

The fund has given 22.27 percent returns on an year-to-date basis.  The fund's returns are benchmarked against BSE 200 and Crisil Short Term Bond.

For the last six months preceding June 15, 2017, the fund gave 18.91 percent, 23.09 percent,  17.20 percent and 20.31 percent returns in six months, one year, three years and five years, respectively.

ICICI Prudential  Balanced Fund

The fund had assets worth Rs 14243 crore on June 30, 2017. Its expense ratio was 2.25 percent. The fund was launched on November 3, 1999 and has returned 15.13 percent since then.

The open-ended fund has 1 percent exit load for redemption within 365 days for units in excess of 10 percent of the investment.

The fund has given 16.64 percent returns on an year-to-date basis.  The fund's returns are benchmarked against Crisil Balanced Fund Aggressive index.

For the last six months preceding June 15, 2017, the fund gave 12.57 percent, 23.95 percent,  15.61 percent and 19.67 percent returns in six months, one year, three years and five years, respectively.

SBI Magnum Balanced fund

The fund had assets worth Rs 12060 crore on June 30, 2017. Its expense ratio was 1.98 percent. The fund was launched on December 31 , 1995  and has returned 16.74 percent since then.

The open-ended fund has 1 percent exit load for redemption within 365 days for units in excess of 10 percent of the investment.

The fund has given 18.33 percent returns on an year-to-date basis.  The fund's returns are benchmarked against Crisil Balanced Fund Aggressive index.

For the last six months preceding June 15, 2017, the fund gave 11.24 percent, 14.26 percent,  15.39 percent and 19.56 percent returns in six months, one year, three years and five years, respectively.

HDFC Balanced Fund

The fund had assets worth Rs 12,483 crore on June 30, 2017. Its expense ratio was 1.97 percent. The fund was launched on September 11, 2000 and has returned 17.10 percent since then.

The open-ended fund has 1 percent exit load for redemption within 365 days for units in excess of 15 percent of the investment.

The fund has given 20.99 percent returns on an year-to-date basis.  The fund's returns are benchmarked against Crisil Balanced Fund Aggressive index.

For the last six months preceding June 15, 2017, the fund gave 16.18 percent, 23.44 percent, 16.33 percent and 19.39 percent returns in six months, one year, three years and five years, respectively.


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