The fruit of long-term investing is in eating them. Ask UTI Mastershare unit holders who have been reaping the benefits of regular dividends. On Wednesday the fund declared its 24th consecutive dividend as it celebrates its silver jubilee. For investors who have re-invested their dividends in the scheme since 1986, their investments have earned 20.91 per cent returns since inception. In contrast the popular market barometer Sensex has earned 16.81 per cent return for the same period.
Advocates of active fund management have a lot to cheer with this spectacular performance of the fund that has weathered through various market cycles, regulatory changes, scams and change in investor needs. On Nov 9, 2010 the net asset value (NAV) of the scheme was Rs 34.93 under the dividend option. However, if someone had followed Warrant Buffet’s philosophy of long-term investment without dividend payout, the NAV would have been a staggering Rs 964.56.
Swati Kulkarni, fund manager of the scheme said, “UTI Mastershare is a large cap oriented fund that invests, in a well diversified portfolio of fundamentally strong companies and avoids sector and stock concentration.” This has gone a long way in helping investors be part of the India story since 1986. Currently, the scheme has more than 6,58,000 investors, with a total asset of Rs 2,648 crore as of September 30, 2010.