IDFC Premier Equity Fund

IDFC Premier Equity Fund is managed by celebrated manager Kenneth Andrade. He has an exemplary track record. The fund is among the best mid cap funds. It has consistently outperformed its benchmark and category average in the past. This is a good fund to hold on to for the long term.

Where does IDFC Premier Equity Fund invest your money ?

IDFC Premier Equity Fund is a mid and small fund which means most of your money will be invested in small and mid companies. About 43.31% of the fund’s money is allocated to stocks of mid sized companies, 22.27% to stocks of small sized companies and the remaining  34.41% to those of large companies. Mid sized stocks can give kicker returns as they turn into large stocks but this happens not so frequently.

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

Minimum one time investment is Rs 10,000 and minimum SIP is Rs 2000. Do not make IDFC Premier Equity Fund 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. IDFC Premier Equity Fund can be part of your satellite portfolio. Do not make 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 IDFC Premier Equity Fund performed in the past?

If you had invested Rs 1 lakh when the fund was launched in Sep 2005, your value of investments would have been around Rs 3.77 lakhs. If you had invested Rs 1 lakh five years back it would have become Rs 1.74 lakhs. Its performance has been better than other mutual funds in this category.The fund has been giving at around 11.81% returns every year for those who stayed invested for last 5 years. 

Assume you had invested Rs 10,000 every month in IDFC Premier Equity Fund through SIP for the past 5 years today you would have around Rs 9.27 lakhs.

How will IDFC Premier Equity Fund 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 follow 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%.

Mutual fund schemes that have exposure to mid sized companies tend to show results when their bet on few companies comes true. 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.

How frequently you need to monitor 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 IDFC Premier Equity Fund is 2.25%. 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 do not withdraw within 1 year. IDFC Premier Equity Fund does not qualify for sec 80C ELSS benefits.

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