Investing Rs 300 daily in this fund would have fetched you Rs 5 lakh in 5 years
Have you ever imagined investing in a fund a small amount daily and ending up with Rs 5 lakhs in five years? Sounds interesting right? Read on to find out more.
Successful investing is always a result of discipline. As Warren Buffett has rightly said, “We don’t have to be smarter than the rest. We have to be more disciplined than the rest.” Therefore, getting successful with investments in mutual funds requires discipline.
A Systematic Investment Plan (SIP) is one such way of having discipline in investing. SIP is the tool that helps you invest in mutual funds (now in stocks well) a small amount regularly. You can invest daily, weekly, fortnightly, monthly, quarterly, or annually in mutual funds via SIP.
If you speak about returns then equity funds seem to be the best choice. However, they also carry higher risk compared to fixed income. But this mutual fund has accumulated Rs 5 lakh in 5 years, just by investing Rs 300 on daily basis. The fund that we are talking about is ICICI Prudential Balanced Advantage Fund.
If you had started investing Rs 300 daily in ICICI Prudential Balanced Advantage Fund from August 10, 2017, then you would have accumulated Rs 5.05 lakh to date which is almost 1.4 times of total amount invested. The daily SIP in this fund yielded an XIRR of 12.36 per cent.
In fact, investing in Nifty 50 in a similar way also generated near about the same results. Moreover, in case of ICICI Prudential Balanced Advantage Fund, it came in with a lower risk compared to Nifty 50. ICICI Prudential Balanced Advantage Fund invests majorly in equity and debt securities.
|
Trailing Returns (%) |
YTD |
1-Year |
3-Year |
5-Year |
7-Year |
|
ICICI Prudential Balanced Advantage Fund |
4.81 |
9.26 |
13.79 |
11.02 |
10.88 |
|
Category Average |
1.97 |
6.55 |
13.01 |
9.11 |
9.36 |
In terms of returns, it seems to beat the category average in all the trailing periods by a good margin.
|
Risk Metrics (%) |
Mean |
Standard Deviation |
Sharpe |
Sortino |
Beta |
Alpha |
|
ICICI Prudential Balanced Advantage Fund |
13.72 |
13.85 |
0.74 |
0.75 |
0.72 |
1.43 |
|
Category Average |
12.76 |
12.47 |
0.76 |
0.94 |
0.62 |
1.64 |
However, when it comes to risk metrics, the fund proves to be higher in risk compared to category average.
As said earlier, investing is the game of discipline and nothing better than investing via SIP. However, it is equally important to first assess your risk profile and match the same with the risk profile of the fund.
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