Ask Value Research

Dividends don’t mean Performance

Regular dividends don’t necessarily mean that an equity-oriented fund is doing well…

I want to invest Rs 10 lakh. Should I go for a regular dividend paying mutual fund or look at any other instruments?
-Kamal Mitthal

We would suggest you to not consider any fund for periodic dividends, because dividend is no pointer to the real performance of a fund. A fund giving out regular dividends could be a disappointing fund. Hence, if you're looking for conservative equity exposure, invest the money in a good balanced fund or a good dividend yield fund. Don’t opt for the dividend plan of any equity fund.

This article was originally published on September 21, 2012.

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