Birla Sun Life Dividend Yield Plus- Plan B

Birla Sun Life Dividend Yield Plus is one of the better performing funds in its category. This fund is managed by Nishit Dholaki who took over in the beginning 2011. Nishit has more than 5 years experience in mutual fund industry.  The fund has been following the Defensive Investment Strategy and it is the belief of the fund manager that the companies paying dividends regularly are ‘Shareholder Friendly’. The fund has never given stellar performance in a bull run but has protected against downfall in a bearish times.

Where does Biral Sun Life Dividend Yield Plus-Plan B invest your money ?

Birla Sun Life Dividend Yield Plus is a small & mid cap fund which means most of your money will be invested in medium size and small companies. Large cap companies tend to be stable compared to mid cap and small cap companies. But mid cap companies can give kicker returns. BSL Dividend Yield Plus has 42.52% exposure to large cap companies, 36.84% exposure to mid cap companies and 16.82% exposure to small cap companies.

Suitable for what?
  • Creating Wealth
  • Lifestyle needs
Not Suitable for?
  • Child's Marriage
  • Child's Education
  • Buying a house
  • Planning for retirement
How much to invest?

Minimum one time investment is Rs 5000 and minimum SIP is Rs 1000 per month. Do not make Birla Sun Life Dividend Yield Plus as part of your core portfolio. Core portfolio includes investments that are made for your basic goals and makes up about 70% of your investment portfolio. Birla Sun Life Dividend Yield Plus can be part of your satellite portfolio due to its huge exposure to mid cap stocks. Do not do the mistake of investing in too many mutual fund schemes. At any point of time do not have more than two mutual fund schemes in your core portfolio.

Our recommendation for fresh investment
Our recommendation for existing investment
How has Birla Sun Life Dividend Yield Plus performed in the past?

If you had invested Rs 1 lakh when the fund was launched in Feb 2003, your value of investments would be around Rs 8.85 lakhs. If you had invested Rs 1 lakh five years back it would have become Rs 1.75 lakhs. The performance has been better than other diversified cap mutual funds. The fund has been giving at around 11.95% every year for those who stayed invested for last 5 years.

Assume you had invested Rs 10,000 every month in Birla Sun Life Dividend Yield Plus through SIP for the past 5 years today you would have around Rs 8.39 lakhs.

How will Birla Sun Life Dividend Yield Plus perform in the future?

Needless to say no one can predict the future of markets. We have firm belief in the future prospects of the Indian economy. If the Indian economy grows at 9% then the leading companies would tend to do well. When the companies do well their stock prices follow their performance. So if you expect the economy to grow at 9% then you can expect top performing mutual funds to give you returns in excess of 15%. We advise you to avoid too much of star gazing and future prediction.  Be reminded that equities are one of the asset classes that have the potential to beat inflation.  Your aim for core portfolio should be to beat inflation.

When to review the performance?

Once you invest in the fund do not get into the habit of checking the NAV daily or monthly. Review the performance once a year. Too much attention is not good.

What charges apply?

A onetime fee of Rs 100 is charged on investments over Rs 10, 000 made through distributors. If you are a first time investor in mutual funds an additional Rs 50 is charged to cover KYC expenses. This is deducted from your investment and can be skipped if you buy directly from the mutual fund via their website or offices.

If units are sold within a year an exit load of 1% is deducted from your total returns. No exit load applies for units withdrawn post one year. Expense ratio of Birla Sunlife Dividend Yield Plus is 2.51%. This is charged to recover the fund management company’s expenses on securities’ transactions, commissions, registrar fees, etc. Your mutual fund returns will be total returns less expense ratio. 

When to enter?

Now! There is no good time to invest rather than now. Do not try to time the market and especially so if it is an SIP. Do not follow news channel and other experts to know the right time to invest. In the long run it does not matter. Mutual fund is unlike a stock where you are looking at the right price. This job will be done by the mutual fund scheme manager. If you have planned your investments and decided on the amount you want to invest do not think further, just go ahead.

When to exit?

Withdraw when your goals are close to achievement. Do not remove the money when the markets go up or down. Do not panic. Stick to your goals.

What are the tax implications?

The returns in a mutual fund are absolutely tax free, provided you did not withdraw within 1 year. Birla Sun Life Dividend Yield Plus does not qualify for sec 80C ELSS benefits.

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