HDFC Index Fund - Nifty Plan

HDFC Index Fund- Nifty Plan is managed by Vinay Kulkarni. The fund has been a laggard like most other nifty index funds. It is a passively managed fund. The fund manager’s job ends at allocating funds in stocks in the same proportion as found in Nifty index. Existing investors can keep a close watch on the performance of the fund.

Where does HDFC Index Fund - Nifty Plan invest your money ?

HDFC Index Fund- Nifty Plan is an index fund which means your money will be invested in stocks on the Nifty in the same proportion as they occur on the index. Large cap companies tend to be stable compared to mid-cap and small cap companies. About 97.9% of the fund’s money is allocated to stocks of large size companies and close to 2.10% to those of mid cap companies.

Suitable for what?
  • Child's education
  • Child's marriage
  • Planning for retirement
  • Home Purchase
Not suitable for?
  • Creating wealth
  • Short term needs
  • Lifestyle needs
How much to invest?

Minimum one time investment is Rs 5000 and minimum SIP is Rs 500 per month. You can make HDFC Index Fund - Nifty Plan 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. 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
Not Recommended
Our recommendation for existing investment
Recommended
How has HDFC Index Fund-Nifty Plan performed in the past?

If you had invested Rs 1 lakh when the fund was launched in Sep 2002, your value of investments would be around Rs 4.56 lakhs. If you had invested Rs 1 lakh for 5 years, your value of investments would be around Rs 1.10 lakhs. The performance has not been better than the average large cap mutual funds. The fund has been giving at around 2.02% every year for those who stayed invested for last 5 years.

Assume you had invested Rs 10,000 every month in HDFC Index Fund- Nifty Plan through SIP from the past 5 years today you would have around Rs 7.45 lakhs.

How HDFC Index Fund-Nifty Plan will 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 8% then you can expect top performing mutual funds to give you returns in excess of 14%.

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.

What charges apply?

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 HDFC Index Fund- Nifty Plan is 1.05%. 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.

What are the tax implications?

The returns in an equity mutual fund are absolutely tax free, provided you did not withdraw within 1 year.

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