Switching Funds

I had invested in Franklin India Prima Fund-Dividend Payout Option through SIPs three years back when it was enjoying a 5-star status. I discontinued my SIPs when its ranking slipped below 4-stars two years ago. But I did not redeem the units. I find that it has been giving dividends of 60 per cent continuously for the last three years. Why should this happen? Is there any difference in performance of ‘Growth’ and ‘Dividend – Payout’ options? Shall I switch to another fund in the same category? If yes, please suggest a few good funds.

This article was originally published on August 14, 2009.