HDFC Prudence fund : Is it really serving its purpose ?

POSTED BY prasoon ON August 1, 2013 11:20 pm COMMENTS (13)

I started SIP in Prudence in 2010 with a 6 year outlook. I believe 6 years is not a short term for a hybrid fund. Seeing that a onetime leader in hybrid funds is now poorly ranked among its peers ( considering 3 years performamnce) the question comes into mind- is it just the fund manager’s patient stategy which will pay-off at the end of 6 years or is it that something ahs gone wrong and the losses are irreversible?

13 replies on this article “HDFC Prudence fund : Is it really serving its purpose ?”

  1. Dear Prasoon, what is the BSE 200 Index performance (the index for HT200) for this period if you invest the similar SIP there? Similarly for HDFC prudence, please check the SIP performance for Crisil Balanced Fund Index.

    Thanks

    Ashal

  2. Dear Prasoon & SK, What are your actual SIP returns?

    thanks

    Ashal

    1. prasoon says:

      Dear Ashal ,
      Mainly sip and occasional small amount lumpsum investment :

      for Prudence ( started on dec 2010 ) return is -1.99
      HDFC T 200 ( started since nov 2009 ) : 0.70

  3. Dear Prasoon, trailing return means counting is done from today to the past date. Calender year return means the actual return generated by the fund in that particular Calender Year.

    thanks

    Ashal

    1. prasoon says:

      Dear ashal ( ashport ) ,
      As a matter of fact , it were u , who taught me abc of personal finance and about MF 4 year back . Thanks a lot again !
      Can u please make clear the difference between two by showing some example ?
      If the CY return is above average , then why my sip return in prudence fund is in negative on 1 , 2 and 3 year basis .?

      dr prasoon

    2. SK says:

      Dear Ashal

      If what you say is correct, then, for an SIP investor, its the ‘trailing returns’ which matter more than the ‘calendar year return. Isn’t it?

  4. Dear Prasoon, your problem is ranking or poor return? if you are asking for ranking, I do not invest on the basis of ranking. if your query is meant for returns, please check this –

    http://www.valueresearchonline.com/funds/fundperformance.asp?schemecode=600

    Please check for CY returns in 2010, 2011, 2012. Each year Prudence has beated it’s category handsomely. Where is the need to worry?

    Thanks

    Ashal

    1. prasoon says:

      dear anshal ,
      I m confused .
      Trailing return show below category where as annual return show well above category return .
      What does it mean ?

      –Prasoon

      1. prasoon says:

        Same thing is true for HDFC T 200 .

  5. prasoon says:

    I do not know why my question is not visible to all including me too .
    By the way , my question has been answered .

    Same thing goes with HDFC T 200 , i have sizeable investment in both of this funds .
    Im ready to remain invested in them , if nothing fundamentally gone wrong with these funds .
    What is the reason for its underperformance : a misjudgement OR some long term wisdom ( at the cost of short term underperformance ) ?

    Prasoon

  6. hdfc prudence in not your typical balanced fund. It is a highly risky fund which invests in some debt.

    If you have invested with a 6 year outlook, then in my view, you were wrong.

    For goals less than 10 years old equity should not be more than 30-40%
    debt oriented funds like MIP should do the job.

    read this for a perspective:

    http://freefincal.com/2013/04/21/comprehensive-mutual-fund-investment-mode-comparator/

    If you have a 6 year time frame and you have lost half of it, the losses are reversible unless there is a dramatic turnaround.

  7. SK says:

    Sorry to gatecrash in Prasson’s thread but I think I have a similar query and your views on my query may help Prasson and more.

    I started SIP in Prudence in 2010 with a 6 year outlook. I believe 6 years is not a short term for a hybrid fund. Seeing that a onetime leader in hybrid funds is now poorly ranked among its peers ( considering 3 years performamnce) the question comes into mind- is it just the fund manager’s patient stategy which will pay-off at the end of 6 years or is it that something ahs gone wrong and the losses are irreversible?

  8. What purpose are you talking about? Your question is not visible.

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