Mutual Fund IDEA- Dividend Yield funds

30.07.22 04:40 PM - By Nikhil Tandulwadikar

ICICI Pru Dividend Yield Fund

Equity investment comes in many flavors. One of them is a divided yield mutual fund.

The objective of a dividend yield funds is to focus solely on companies that pay regularly divided. The reason such companies are able to pay-out dividend is because of profitable business. So let's look at ICICI Prudential Dividend Yield Equity Fund.

Why should you invest in Dividend yield fund

Volatile equity markets due to geo-political tensions and global slowdown
Rising Inflation
Changes to interest rate

These are the kind of scenarios when dividend paying stocks look attractive. Dividend pay is a sign of healthy business. So when things look bleak investors flock to such companies.

But not all companies are worth investing. In India PSU are generally associated with high dividend. Yet these businesses may not be the best managed businesses.

About ICICI fund
ICICI Pru dividend Yield Equity funds intends to limit its exposure to PSU stocks. The fund also has taken exposure to stocks that can pay dividend in coming years. This makes the fund unique in this category. This has let to a creation of portfolio that is different from other dividend funds. About 43% of the portfolio is in IT and Financial sector. While others in the category dont have more then 20% to these sectors. This approach differentiates the fund from others in the category.

Top 10 holdings
ICICI dividend-yield top holdings as of June-22
below is the funds performance snapshot.
Do note that during growth period dividend yield fund may underperform the overall markets. But as markets cycles changes these funds will surely ass value to your overall portfolio.

monthly performance

quarterly performance

Do note that past performance is not a reflection of future returns

Disclaimer: Mutual Fund investments are subject to market risks, read all scheme-related documents carefully.

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