Can you tell which of the mutual funds made the top spot on the return charts over the past year? If you’re not sure, we’ll let you know.

The data indicates that PSU themes-based returns have topped the charts for returns since the previous Holi (March 8, 2023). There were 372 equity mutual funds over the period

Who is on top

Aditya Birla Sun Life PSU Equity Fund will top the list. The fund has earned an impressive return of 76.93 percent since the last Holi.

During the same period, the SBI PSU Fund gave a return of 72.60 percent.

At this time, Invesco India PSU Equity Fund which is the oldest scheme within the PSU category, has provided an average return in the range of 70%.25 percent.

ICICI Prudential PSU Equity Fund has given returns of 69.88 percent in the same period.

Did the benchmark get defeated?

These schemes are tested against the benchmark S&P BSE PSU – the TRI.

The benchmark gave an annual return of 82.40 percent over the same time frame. The study revealed that all four of the schemes not been able to match their benchmarks.

What were the returns of other schemes?

Other funds on the list offered returns ranging between 2.48 percent to 57.82 percent in the same period.

Franklin Asian Equity Fund had the lowest return, 2.48 percent. It is important to note that we took into account all equity categories, including Small Cap, Mid Cap, Large and Mid Cap, Multi-Cap and Small Cap, the ELSS, Flexi Cap, and Focused Funds.

Contra, Value Thematic, Sectoral Funds and. We determined the returns for March 8th, 2023 until March 22, 2024. We looked at every regular and growth option.

What is a PSU fund?

PSU funds are a thematic fund that invests in the shares of public sector companies also known as PSUs. They are government-owned.

They are therefore affected by the policies of the government within the sectors they operate in. It is recommended to invest in these funds only when you have a long-term time frame for investing or have a thorough understanding of the industry in regard to the timings for entry and exit within these schemes.

Keep in mind that any sector or subject is susceptible to going out of style based on the economy. You should not make hasty decisions in those stages.

It isn’t a suggestion. Note that the above analysis is not an endorsement. This analysis was conducted to determine what equity mutual funds performed since the most recent Holi.

One shouldn’t make any investment or redemption decision in reliance on the information provided above.

What is the Return of PSU Equity Fund?

PSU funds offer stability to investors looking for secure investments. By diversifying across public sector undertakings in various sectors, they invest capital efficiently while being professionally managed by financial experts to maximize return potential on invested capital.

Banking and PSU debt funds typically offer low-risk profiles as they mainly invest in AAA-rated or equivalent debt instruments issued by quasi-sovereign status borrowers, providing experienced investors with stable credit profits with lower volatility.

Returns

PSU equity fund returns are determined by several factors. First and foremost is their investment mandate and portfolio: for instance, some funds specialize in PSU bond investments across varying tenures, earning interest payments that they convert to income; these options suit investors who prefer low-risk profiles.

Other funds specialize in investing in PSU stocks to generate capital appreciation, making these funds suitable for more risk-averse investors; however, before making your decision it’s essential to examine their portfolio allocation and credit quality before making your choice. Also, be wary of funds that focus exclusively on one stock.

Before you invest it is important to consider carefully the cost ratio and fees of the funds you pick. As these expenses can reduce the overall return, it would be wise to select one with a low expense ratio and low entry/exit load loads.

PSU equity mutual funds, also known as PSUs are flexible plans which invest capital in public-owned enterprises via bond and equity markets.

These firms play key roles in India’s growth story and offer relative stability with lower volatility compared to private sector firms – providing an ideal way for investors to participate in this growth story.

Expense Ratio

When investing in mutual funds, remember to carefully consider their expense ratio as it can greatly influence your returns in the long term. As higher expenses mean lower returns; compare multiple PSU equity funds before making your final decision on one.

ICICI Prudential PSU Equity Fund Direct-Growth gives investors high returns and low cost of operation.

Its AUM has grown faster than its category average, making it a good option for investing in PSU equity funds. Investors should keep in mind, however, that this fund should only be considered suitable for long-term investments due to being an open-ended equity fund and potentially experiencing fluctuations.

banking as well as PSU funds are extremely liquid investments that provide higher yields than traditional investment options, such as certificates of deposit, bonds, and debentures. They appeal to a range of investors looking for steady credit profiles with increased yields.

Investors should note that returns on PSU funds do not incur capital gains taxation. However, the profits that are held for longer than three years are subject to a capital gain tax at 20%, with indexation advantages.

Taxes

Investment in mutual funds comes with various costs that will impact your returns; one such cost is the expense ratio, which measures fees and expenses as a percentage of total assets managed.

A lower expense ratio indicates a smaller portion of returns will go toward fees and expenses.

PSU equity funds present investors with an exceptional opportunity to gain exposure to government-owned companies with strong fundamentals and growth potential.

Although not entirely risk-free, these funds tend to be less volatile than others and usually deliver superior dividend yields than their broader market counterparts.

An equity fund from PSU can be an excellent way to diversify your portfolio, but selecting the appropriate one requires due diligence.

Be sure to carefully examine each fund’s investment objective, portfolio composition, expense ratio, and exit load before investing – look out for those offering low minimum initial investment requirements as these could prove more worthwhile investments than others.

ICICI Prudential PSU Equity Fund Direct-Growth is an open-ended equity mutual fund designed to achieve long-term capital appreciation by investing in Public Sector Undertaking stocks and equity-related instruments, investing up to 20% of assets in non-PSU opportunities such as debt and money market instruments; subject to additional risks associated with mid and small-cap stocks as investments may include them.

Management

PSU equity funds are open-ended mutual funds that invest in stocks and equity-related instruments of Public Sector Undertakings owned by the government.

These funds typically offer higher returns with reduced risk than traditional mutual funds, making them suitable for investors seeking steady income and long-term security. It is important, however, to select one with a low expense ratio.

The Invesco India PSU Equity Fund Direct-Growth scheme features an affordable expense ratio and is one of the premier PSU equity funds on the market. Its five-year performance has been exceptional; however, investing in it should only be done on an extended timescale due to potential risk.

This fund is overseen by experienced fund managers and seeks to deliver consistent returns over the long term.

It invests in large, mid, and small-cap companies and diversifies its portfolio to minimize market fluctuations. Bharat Electronics Limited, National Thermal Power Corp (NTPC), State Bank of India, and Coal India Limited are some of its top holdings.

PSU equity funds are currently enjoying strong momentum, due to favorable operating conditions and increased government capital expenditure.

They have moved beyond the cyclicality of their earnings and valuations are attractive compared to historical averages; furthermore, they enjoy enhanced shareholder rewards such as dividends and buybacks which have resulted in improved Return on Equity.