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How is HDFC Prudence fund for monthly dividend and growth

How is HDFC prudent fund for dividend monthly and growth or is there any other better monthly dividend fund. Please help with your advise?

Aug 5, 2016 by Ram, Mumbai  |   Mutual Fund

HDFC Prudence Fund is one of the oldest balanced funds in the mutual fund industry in India with an excellent long term track record. From January 2016 it has started paying monthly dividends which you can check from here – HDFC prudence Historical Dividends.

But somehow the performance of this is fund is subdued in the last 4-5 years and therefore, the rating of this fund has gone down. It is now rated 2 Star only by Valueresearch. CRISIL rating for this fund has also gone down and currently at Rank-4.

However another balanced fund from HDFC Mutual Fund has taken over this fund in terms of consistent performance. The fund is HDFC BALANCED FUND. This fund is very well rated - 4 Star by Valueresearch. CRISIL rating for this fund is also very good at Rank 2. The fund has given dividends since 2003 till 2016 and only skipped the dividends in the year 2004 and 2008 when the markets were down. The fund used to give annual dividends till 2014 but from 2015 it has started giving quarterly dividends consistently. You may check the Historical Dividend paying track record of HDFC Balanced fund here.

HDFC Balanced fund has given 25.99%, 15.33%, 15.75% and 16.74% annualised returns for the period of 3years, 5 years, 10 Years and since inception respectively. Compared to this, HDFC Prudence Fund has given 24.69%, 13.04%, 15.85% and 196.74% annualised returns for the period of 3years, 5 years, 10 Years and since inception respectively.

According to the current consistent returns, rolling returns and ratings, HDFC Balanced Fund is better placed but it gives quarterly dividends whereas your requirement is monthly dividend. However, if you want monthly dividends and want to bank on the long term track record of HDFC Prudence Fund, then it is not a bad fund either.

Therefore, before deciding to invest, assess your dividend requirements once again and also the investment horizon.

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