Financial Planning: A mutual fund that doubled your money in five years
Everyone tries to find the best investment options for their money and long term financial planning. Although investing in mutual funds has its own risks as its linked to the fortunes of the stock markets they are still considered a safe bet if you want to grow your money more than what a usual fixed deposit or banks' deposit interest rate would offer.
However, there are mutual funds that have grown so much in the past five years that they whave literally doubled the money of people who invested in those.
One such fund Franklin India Feeder - Franklin U.S. Opportunities Fund (Growth). The fund belongs to Equity asset class from Franklin Templeton Mutual Fund family.
The fund in the last five years has given absolute return of 102.65%. In 2012, the fund had net asset value of 11.17. Presently, the NAV is 22.62. The fund's asset size is Rs 566.03 crore.
The open ended fund seeks to provide capital appreciation by investing predominantly in units of Franklin U. S. Opportunities Fund, an overseas Franklin Templeton mutual fund, which primarily invests in securities in the United States of America.
When we say open ended fund, which means these are funds in which units are open for purchase or redemption through the year. All purchases/redemption of these fund units are done at prevailing NAVs. These funds are preferred since they offer liquidity to investors.
This fund principally invests in small, medium and large capitalisation U.S. companies with strong growth potential across a wide range of sectors.
The minimum investment requirement is just Rs 5000. An investor has an option of Systematic Investment Plan (12 cheques each of Rs.500/- or more or a minimum of 6 cheques each of Rs.1,000/- or more), Systematic Transfer Plan and Systematic Withdrawal Plan, to enter the fund.
Apart from this, what makes this fund even more profitable is its tax benefits. According to Franklin Templeton India, the fund has three tax benefits:
- Long term capital gains (LTCG) tax @20% (plus surcharge, if applicable and cess) with indexation if units held for more than 36 months
- Short term capital gains (STCG) tax at the income tax slab rate if units are held for less than 36 months
- Investor does not pay any tax on dividends but a Dividend Distribution Tax (DDT) is deducted at source @28.84% (25% + 12% surcharge + 3% education cess)
Disclaimer: This story is for informational purposes only and should not be taken as an investment advice.