Why Revamp Your Portfolio with HDFC Top 100 Fund?

Author: Dishika Baheti

HDFC Top 200 Fund makes the primary investment in S&P BSE 200 Companies with the aim to provide the capital appreciation in the long-term. HDFC Top 200 Fund has been renamed as HDFC Top 100 Fund w.e.f May 23, 2018. Investors who are looking for making the investment in the equity and equity derivatives can opt to invest in this fund in order to enhance the value of their portfolio and avail the benefit of high returns attached with the low-risk appetite. The scheme is ranked 5th in the large-cap category of the mutual fund by CRISIL.

More About the Fund

  • Type- Open-ended Growth Scheme
  • Minimum Investment- The minimum amount can be invested in the fund is Rs. 5000 and can be done further in the multiples of Re.1.
  • Additional purchase amount- The lowest additional purchase can be made is of Rs. 1000 and in multiples thereafter.
  • Fund house- HDFC Mutual Fund
  • Inception date- September 3, 1996
  • Benchmark- NIFTY 100
  • Risk- Moderately high
  • Entry load- Entry load is applied when an investor buys the units of the scheme and no entry load is charged in case of units allotted as a bonus.
  • AUM- Rs. 14,789 Cr. (As on May 31st 2018)

    • Investment philosophy

    The philosophy carried by the fund is to invest only in the top large companies which are listed on the BSE 200 index in order to minimize the risk in the pace of fast growth. These companies are shortlisted after a deep research by the investment team and the strategy of investing is modified according to the favorable changes.

    Fund manager

    Mr. Prashant Jain is the fund manager of this fund, who is a B.Tech from IIT Kanpur, PGDM from IIM Bangalore, and CFA from AIMR USA. Before joining the HDFC Mutual Fund, he has working experience with SBI Mutual Fund and Zurich AMC. He holds an extensive and strong experience in research and fund management. Currently, Mr. Jain is an Executive Director, Chief Investment Officer, and Fund Manager at HDFC Asset Management Company Ltd.

    Risk Factors of the Fund

    Following are considered as the key risk factors of the HDFC Top 200 Fund:-

  • Securities can be proved to be risky for the portfolio, which is not traded on the stock exchange as compared to the listed ones because stocks which are not listed on the stock exchange are not liquid and can cause the liquidity risk.
  • Debt and various money market instruments of the scheme can be affected by the NAV of the fund because there can be the changes in the interest rates. Therefore, NAV can be expected to increase with the fall in the interest rate.

    • Portfolio Construction

    The portfolio of the scheme has a long-term high growth focus. The fund is overweight in BFSI sector with the substantial exposure to the energy, IT, FMCG and automobile. 26% of the allocation is in the BFSI sector, 19% to energy, 15% to IT, 8% to automobile and 7% to FMCG.

    Performance of the Fund

    The annualized returns of the fund were outstanding as in 2012 it has delivered 32.43% returns, in 2014 the returns of the fund were 46.52%, and in 2017 it has delivered 31.97% returns.

    HDFC Top 200 Fund has a tremendous and strong track record of wealth creation since its inception in 1996 and it has delivered over 20% annualized return from the inception. The fund has also beaten its category and benchmark return in the last 10 years and is managed by one of the marquee fund managers in this asset management business, Mr. Prashant Jain.

    This article is to learn about HDFC Top 100 Fund and what are the benefits attached to it by investing in the scheme.