ET Wealth collaborates with Value Research to analyse top mutual funds. We examine the key fundamentals of the fund, its portfolio and performance to help you make an informed investment decision.
HDFC Long Term Advantage Fund
How has the fund performed?
With a 10-year return of 10.42%, the fund has outperformed both the benchmark (5.08%) and the category average (8.11%) by a good margin.
The fund has outperformed the category and the index over the past decade.
As on 4 jan 2018
Annualised performance (%)
The fund has marginally outperformed peers over 3- and 5-year periods.
As on 4 jan 2018
Yearly performance (%)
The fund's performance in recent years has been inconsistent.
BASIC FACTS
Date of launch : 2 Jan 2001
Category : Equity
Type : Tax saving
Average AUM : Rs 1,575.64 cr
Benchmark : S&P BSE Sensex Index
WHAT IT COSTS
NAVS*
Growth option : Rs 356
Dividend option : Rs 48
Minimum investment : Rs 500
Minimum SIP amount : Rs 500
Expense ratio (%)^ : 2.34
Exit load: 1% for redemption within 365 days
.*As on 4 jan 2018
Fund manager : Chirag Setalvad
Tenure: 10 years and 8 months
Education: B. SC and MBA
Where does the fund invest?
Top picks are index heavyweights, but it's not so with the rest of the portfolio.
How risky is it?
The fund's risk-return profile is on par with its category average.
Based on 3-year performance. Data as on 31 dec 2017
Wherever not specified, data as on 30 Nov 2017. Source: Value Research
Should you buy?
This tax-saving fund has a patchy track record. While it delivered strong outperformance in 2016, its performance dipped last year. This is partly due to its higher tilt towards large-caps relative to many of its peers. The fund retains a compact portfolio of 40-odd stocks, with large positions in its top bets. The fund's top picks are all benchmark heavyweights, but otherwise its portfolio bets have little resemblance to the index.
Even though financials form a chunk of its portfolio, it remains significantly underweight compared to the sector's weight in the index. The portfolio turnover ratio, or churn, is among the lowest, indicating a strict long-term holding orientation. Investors may opt for other proven funds offering more consistency in outperformance.
