HDFC Commodity Mutual Fund

HDFC Commodity Mutual Fund is one of India's biggest mutual fund companies, with assets under management totalling Rs 4,23,716 crore. A joint venture between HDFC Limited and abrdn Investment Management Limited, the business was founded in 1999, and in August 2018, it went public. The fund holds 11% of the industry's AUM and has a significant equity investment portfolio. As of 31st March 2022, it had 9.9 million live accounts from retail and institutional customers.

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22.53Apr 19, 2024
23.50Apr 19, 2024
63.60Apr 19, 2024
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HDFC Commodity Mutual Fund - Investment Objective

Over the medium to long term, HDFC Mutual Fund Commodity seek to give investors consistent income and capital growth. These investments, also referred to as hybrid funds, combine fixed-income and equity securities to produce growth with a relatively stable portfolio. The type of balanced fund would determine the asset allocation percentage. For an aggressive mutual fund, the equity allocation would be between 65% and 80%. However, for a cautious hybrid fund, it could be as low as 10% to 25%. On the other hand, a multi-asset allocation fund may take exposure to other asset classes like gold, debt, and equity. A programme like an Equity Savings Fund might expose itself to some derivatives.

Risks Involved in HDFC Commodity Fund

HFDC Mutual Funds have a fairly low to moderately high market risk. The value of the fund may fluctuate depending on how much the price of the underlying equities or debt instruments fluctuates. Interest rates, exchange rates, governmental policies, tax regulations, and other economic factors may impact the price of stocks or bonds. The degree of portfolio diversification and exposure to equities as an asset class determine the level of risk. A mutual fund that invests substantially in both long-term bonds and stocks will be much riskier than one that favours debt as an asset class. Before investing in a scheme, investors may consider their risk tolerance.

Return Potential of HDFC Commodity Mutual Fund

Returns are a byproduct of the investor's assumed risk. The balanced funds sit between equities and debt funds on the risk-return spectrum. The advantage of having a mix of equities and bonds allows HDFC Mutual Fund to produce greater risk-adjusted returns with relatively low volatility. These funds have a track record of generating returns that range from 10% to 12% on average over five years or longer. Certain equity-oriented balanced funds have recently produced returns comparable to large-cap equity funds. Due to greater exposure to mid-cap equities, this resulted. The performance of the HDFC Mutual Fund may change from one period to the next, and they do not promise assured returns.

Who Should You Invest in HDFC Commodity Mutual Fund?

Investors with a low tolerance for volatility can consider HDFC MF Balanced Funds. This might make it easier for them to monitor any losses from dynamic asset allocation. But if you're an ambitious investor, equities funds can be preferable to balanced funds. You will be able to realise equity's full potential with this method. Additionally, a moderately risk-averse investor with long-term objectives like saving for retirement or their children's education may invest in balanced funds. To benefit from market fluctuations, the fund manager of HDFC MF Balanced funds rebalances the portfolio. Investors who want to avoid the hassle of managing their portfolios can think about investing in these funds.

Things to Consider before Investing in HDFC Commodity Mutual Fund 

Here are some things to think about to help you choose the best equity fund if you're considering investing in them:

  • Fund Size
  • The ratio of Expense
  • The ratio of Risk Reward
  • Benefits in Tax
  • Fund Taxation
  • Dividends
  • Individual Financial Goals
  • Fund Performace

Tax on HDFC Commodity Mutual Fund 

Buyers of HDFC mutual fund shares should know that income payments are subject to a 10% tax rate. On the other hand, the proceeds from the sale of mutual fund shares before the one-year waiting period are subject to a short-term capital gains tax. Regardless of a person's marginal tax rate, this temporary tax is applied at 15%. With no yearly inflation benefits, investment income over Rs. 1 lakh is subject to a 10% long-term taxable profit.

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Frequently Asked Questions (FAQs)

How is HDFC Mutual Fund doing?

The largest mutual fund and actively managed equity mutual fund in India currently is HDFC Mutual Fund. It is a top-performing asset management company (AMC) in the nation. As of March 31 2022, the company was in charge of assets worth Rs. 432084.97 crores.

Is HDFC Mutual Fund safe?

Yes, investing in HDFC mutual fund equity is secure because highly skilled fund managers manage the funds. The fund house is also promoting it as a viable investment option. It is also crucial to be aware of the market dangers associated with investing in mutual funds. Investors are urged to do extensive research and thoroughly review all fund-related documentation.

Is it good to invest in equity funds?

The best approach to profit from the stock market and save for the future is through equity funds. In addition, equity funds offer higher returns than fixed deposits. To enjoy your money more, choose equity funds rather than fixed deposits if you have a long time horizon.

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