Dividend Yield Funds

Dividend Yield Funds invest at least 65% of their portfolio in equities such that the stocks reward shareholders with high and consistent dividend payouts, bonus shares or share buybacks. These funds can have a value tilt, they can be a blend of growth and value, or they may be growth-oriented. View More

The aim of these funds is to provide medium to long term gains and/or dividend distribution by investing in equity and equity-related instruments of dividend-yielding companies. Dividend Yield Funds with a value tilt invest mainly in stocks that are undervalued and are trading at a market price that is lower than their intrinsic value.

However, the companies that the funds invest in have strong fundamentals, so the market will eventually realise their actual value.

Best Dividend Yield Funds

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Search Result - 9 Mutual Funds

Who Should Invest in Dividend Yield Funds?

Features of Dividend Yield Funds

Taxability of Dividend Yield Funds

Risk Involved with Dividend Yield Funds

Advantages of Dividend Yield Mutual Funds

Popular Dividend Yield Funds

  • Fund Name
  • Min SIP Investment Amt
  • AUM (Cr.)
  • 3Y Return

Templeton India Equity Income Fund is an Dividend Yield scheme that was launched on 01-01-13 and is currently under the management of our experienced fund manager Anand Radhakrishnan. With an impressive AUM of ₹1,410 Crores, this scheme's latest NAV is ₹97.6945 as of 26-05-23.

Templeton India Equity Income Fund scheme has delivered a return performance of 13.4% in the last 1 year, 36.4% in the last 3 years, and an 14.7% since its launch. With a minimum SIP investment of just ₹5,000, this scheme offers a great investment opportunity for those looking to invest in Dividend Yield funds.

  • Min SIP Investment Amt
  • ₹5,000
  • AUM (Cr.)
  • ₹1,410
  • 3Y Return
  • 13.4%

ICICI Pru Dividend Yield Equity Fund is an Dividend Yield scheme that was launched on 16-05-14 and is currently under the management of our experienced fund manager Mittul Kalawadia. With an impressive AUM of ₹1,359 Crores, this scheme's latest NAV is ₹33.36 as of 26-05-23.

ICICI Pru Dividend Yield Equity Fund scheme has delivered a return performance of 22.7% in the last 1 year, 38% in the last 3 years, and an 14.3% since its launch. With a minimum SIP investment of just ₹5,000, this scheme offers a great investment opportunity for those looking to invest in Dividend Yield funds.

  • Min SIP Investment Amt
  • ₹5,000
  • AUM (Cr.)
  • ₹1,359
  • 3Y Return
  • 22.7%

IDBI Dividend Yield Fund is an Dividend Yield scheme that was launched on 21-12-18 and is currently under the management of our experienced fund manager Alok Ranjan. With an impressive AUM of ₹85 Crores, this scheme's latest NAV is ₹18.82 as of 26-05-23.

IDBI Dividend Yield Fund scheme has delivered a return performance of 17.4% in the last 1 year, 25.3% in the last 3 years, and an 15.3% since its launch. With a minimum SIP investment of just ₹5,000, this scheme offers a great investment opportunity for those looking to invest in Dividend Yield funds.

  • Min SIP Investment Amt
  • ₹5,000
  • AUM (Cr.)
  • ₹85
  • 3Y Return
  • 17.4%

Sundaram Dividend Yield Fund is an Dividend Yield scheme that was launched on 02-01-13 and is currently under the management of our experienced fund manager Ratish Varier. With an impressive AUM of ₹420 Crores, this scheme's latest NAV is ₹96.3554 as of 26-05-23.

Sundaram Dividend Yield Fund scheme has delivered a return performance of 14.9% in the last 1 year, 26.8% in the last 3 years, and an 13.1% since its launch. With a minimum SIP investment of just ₹5,000, this scheme offers a great investment opportunity for those looking to invest in Dividend Yield funds.

  • Min SIP Investment Amt
  • ₹5,000
  • AUM (Cr.)
  • ₹420
  • 3Y Return
  • 14.9%

Aditya Birla SL Dividend Yield Fund is an Dividend Yield scheme that was launched on 01-01-13 and is currently under the management of our experienced fund manager Dhaval Gala. With an impressive AUM of ₹882 Crores, this scheme's latest NAV is ₹305.18 as of 26-05-23.

Aditya Birla SL Dividend Yield Fund scheme has delivered a return performance of 25% in the last 1 year, 30.3% in the last 3 years, and an 11.8% since its launch. With a minimum SIP investment of just ₹1,000, this scheme offers a great investment opportunity for those looking to invest in Dividend Yield funds.

  • Min SIP Investment Amt
  • ₹1,000
  • AUM (Cr.)
  • ₹882
  • 3Y Return
  • 25%

UTI-Dividend Yield Fund is an Dividend Yield scheme that was launched on 01-01-13 and is currently under the management of our experienced fund manager Swati Kulkarni. With an impressive AUM of ₹2,810 Crores, this scheme's latest NAV is ₹116.038 as of 26-05-23.

UTI-Dividend Yield Fund scheme has delivered a return performance of 14.6% in the last 1 year, 26.5% in the last 3 years, and an 12.3% since its launch. With a minimum SIP investment of just ₹5,000, this scheme offers a great investment opportunity for those looking to invest in Dividend Yield funds.

  • Min SIP Investment Amt
  • ₹5,000
  • AUM (Cr.)
  • ₹2,810
  • 3Y Return
  • 14.6%

Tata Dividend Yield Fund is an Dividend Yield scheme that was launched on 20-05-21 and is currently under the management of our experienced fund manager Sailesh Jain. With an impressive AUM of ₹480 Crores, this scheme's latest NAV is ₹12.495 as of 26-05-23.

Tata Dividend Yield Fund scheme has delivered a return performance of 19.8% in the last 1 year, -% in the last 3 years, and an 11.7% since its launch. With a minimum SIP investment of just ₹5,000, this scheme offers a great investment opportunity for those looking to invest in Dividend Yield funds.

  • Min SIP Investment Amt
  • ₹5,000
  • AUM (Cr.)
  • ₹480
  • 3Y Return
  • 19.8%

HDFC Dividend Yield Fund is an Dividend Yield scheme that was launched on 18-12-20 and is currently under the management of our experienced fund manager Gopal Agrawal. With an impressive AUM of ₹3,155 Crores, this scheme's latest NAV is ₹16.694 as of 26-05-23.

HDFC Dividend Yield Fund scheme has delivered a return performance of 21.9% in the last 1 year, -% in the last 3 years, and an 23.4% since its launch. With a minimum SIP investment of just ₹100, this scheme offers a great investment opportunity for those looking to invest in Dividend Yield funds.

  • Min SIP Investment Amt
  • ₹100
  • AUM (Cr.)
  • ₹3,155
  • 3Y Return
  • 21.9%

Frequently Asked Questions

How do fund houses select ‘High Dividend’ companies?

Most fund houses select ‘High Dividend’ companies by comparing their dividends yield with a benchmark index like Sensex or Nifty 50. For example: If the dividend yield of Nifty 50 currently is near 1.25, a fund house would prefer investing in companies having a dividend yield higher than 1.25.

Is it a good idea to invest in Dividend Yield funds?

Dividend yield funds are generally stable and are a good investment for those looking for low volatile stocks. These funds are not recommended for aggressive growth-seekers, but they prove to be a good addition to most investment portfolios.

Generally, a mutual fund share price falls soon after paying a dividend; why so?

Mutual fund share prices fall after paying dividends because the money paid as dividends is extracted from the existing assets of the fund. 

Do dividend yield funds invest only in ‘High Dividend' companies?

Most dividend yield funds invest about 75%-80% of their capital in high dividend-paying companies. The remaining corpus is invested in companies’ stocks with high returns potential in the future. 

The trick here is to invest in companies with low dividend yields or no-dividend pay that would provide good returns if they are undervalued, provided their fundamentals are strong. 

What is considered to be a good dividend yield?

A reasonable dividend yield depends on the market conditions, but an average yield between 2% to 6% is considered ideal. 

Who are these funds suited for?

Dividend Yield funds focus on the dividend yield of stocks. They are appropriate for investors who are looking to invest in equity funds but with a low level of volatility in their investments. These funds are invested in companies that are generally stable and hence are best suited for the following groups of investors/individuals:

  • Low-risk appetite- Investors who do not prefer to take high risks and prefer to let go of better profits without exposing themselves to market risks. 
  • Diversified portfolio- Those willing to have an all-around investment and assess risk on a large scale should invest in Dividend Yielding funds, thereby assisting the investor in having a diversified portfolio.
  • First-time investors- These funds provide minimal risk-investment routes for limited periods and are best for those investing for the first time in mutual funds. 
  • Short-investment horizon- These funds generate high returns even in short time frames; hence it is a good investment for those who do not want to wait for long spells to gain returns from their investments.
  • Regular income- Investors who are hoping for a regular income from their investments, even though a low one, should consider investing in these funds. 
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