Birla Sun Life India GenNext Fund

Birla Sun Life India GenNext Fund is one of the better performing funds in its category. This fund is managed by Sanjay Chawla. Sanjay is an experienced manager with over 22 years of experience and has been managing this fund from September 2007. If you already hold units in this fund keep a watchful eye on its performance. New investors can also try this fund to complement their core portfolio.

Where does Birla Sun Life India GenNext Fund invest your money?

Birla Sun Life India GenNext Fund is a thematic fund that seeks to invest in companies dealing with products and services catering to the younger population of India. It has a bias towards mid cap and small cap companies. It has 47.71% exposure to stocks of mid cap companies, 13.07% exposure to stocks of small cap companies and 35.62% to large cap companies. The fund seeks to invest in companies that cater to the needs of the young generation.

Suitable For
  • Creation of wealth
  • Lifestyle needs
Not Suitable For
  • Child's Marriage
  • Child's education
  • Home Purchase
  • Short term needs
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 India GenNext Fund as part of your core portfolio. Core portfolio is investments that are made for your basic goals and makes up about 70% of your investment portfolio. Birla Sun Life India GenNext Fund can be part of your satellite portfolio. 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
Recommended
Our recommendation for existing investment
Recommended
How has it performed in the past?

If you had invested Rs 1 lakh when the fund was launched in August 2005, your value of investments would be around Rs 2.8 lakhs. If you had invested Rs 1 lakh five years back it would have become Rs 1.71 lakhs. The performance has been better or similar to other mutual funds in this category. The fund has been giving at around 11.35% every year for those who stayed invested for last 5 years.

Assume you had invested Rs 10,000 every month in Birla Sun Life India GenNext Fund through SIP for the past 5 years today you would have around Rs 9.52 lakhs.

How will it 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 tend to do well. When the companies do well their stock prices follows 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. 

Mutual fund schemes that have exposure to mid size companies tend to show results when their bet on few companies comes true. Your aim for satellite portfolio should be to beat inflation and earn higher returns from diversified large cap funds.

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 Sun Life India GenNext Fund is 3.02%. 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 if it is an SIP. Do not follow news channel and other experts trying 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 closer 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 do not withdraw within 1 year. Birla Sun Life India GenNext Fund does not qualify for sec 80C ELSS benefits.

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