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HDFC Top 200 Fund

All of us wish for our money or assets to appreciate over a period of time and it is quite reasonable, isn’t it? One doesn’t know what the future beholds. Thus, being prepared for the worst-case scenario is always the best mode of defense at times. On the brighter side, if the value of your investments appreciates substantially, you will have the firepower to do more with your money in the future.

People who like to plan, having financial goals is the ideal way to look forward. There are no doubts that investors these days have access to numerous avenues to get the most out of their money. However, none comes close to a mutual fund. Its ease of accessibility, buying and redeeming makes it an excellent choice for fulfilling your financial goals. As an investor, if you are looking for a mode of investment which will help you in the longer run, HDFC top 100 Fund should surely be on your list.

This open ended mutual fund came into existence on the 3rd of September, 1996. Over the next two decades, the fund has been able to help numerous investors achieve their financial goals. The net assets held by the fund is approximately INR 15873.81 crore. If you are someone who is looking for a strong mutual fund that holds its ground during difficult times and returns above average returns as compared to indices, HDFC Top 100 Fund might be the ideal one for you.

Investment Objective of HDFC Top 200 Fund

Most of us might not be aware that all the mutual funds have certain investment objectives and strategies. This helps them establish a connection with potential investors. If your investment objective is in line with the ones provided by the fund, you can relate and invest more confidently. HDFC Top 100 Fund is no different. The central investment objective of the fund is to help individuals with capital appreciation.

To be able to do it accurately, they invest heavily in equity and equity-based instruments. HDFC Top 100 fund chiefly gets its equity and equity based instruments. The fund manager aims at investing only in funds that are listed as the top 100 companies based on the market capitalization as categorized by the Bombay Stock Exchange. In order to maximize the returns, the fund also invests in large IPOs. Of course, the major criteria is to look for IPOs whose offer price would help them venture into the top 100 companies as per the market capitalization.

The most obvious question that an investor might have is, why stick only with the top 100 companies. Well, the top 100 companies as per the market capitalization would help the fund reduce its risk factor. This, coupled with the factor that these companies offer steady and consistent growth, is just the icing on the cake. The fund manager and their team do extensive research on the companies before investing money. They also carry out calculated diversification of the funds, which further helps to reduce the risks involved.

Type of fund

Given the large number of mutual funds that we have access to in India, it should not come as a surprise that they are put into several categories. These categories are ideally made to help investors decide which fund is ideal for them based on a myriad of factors. The HDFC Top 100 Fund is an equity based large cap mutual fund which has an open ended nature.

Any mutual fund that doesn’t have any restrictions on the number of units that the fund house can allocate or issue is an open-ended mutual fund. The fund manager can decide if the fund’s value have become extremely large to manage them properly. In such cases, they can decide to stop investments from new users and in extreme cases even prevent existing investors from buying more units.

And large cap mutual funds are the ones where the fund managers invest in large cap companies. The market capitalization of companies is the factor which helps fund managers decide whether or not a fund is large cap or not. These large companies are less risk prone to invest and are more likely to generate a constant stream of revenue.

The person in charge of the fund is Mr. Prashant Jain. Mr. Jain has been actively handling the fund since 30th of June 2003. Mr. Jain brings more than 20 years of experience to the table, when one refers to fund research and management.

Top 10 holdings

To help you understand the fund better, here are the top 10 holdings of the fund along with their distribution.

HoldingPercentage Allocation
Infosys Limited8.64
Reliance Industries Limited8.45
ICICI Bank Limited7.22
State Bank of India6.69
HDFC Bank Limited6.15
Larsen & Toubro Limited5.78
ITC Limited5.66
NTPC Limited4.23
Tata Consultancy Services Limited3.7
Axis Bank Limited3.44

Here are the top 5 sectors in which the fund invests heavily along with its distribution pattern.

SectorPercentage Allocation
Private Banking16.97
IT – Software Industry15.11
Refineries10.49
Public Banking10.13
Generation and Distribution of Power8.76

Risk Measures

If you have come across any advertisement of mutual funds, you most certainly would have heard the disclaimer at the end. As is the case with any investment opportunity, there are certain inherent risks involved with them. It is only natural that you are aware of these before you start investing your hard earned money. These risks can be split into two categories, Standard risks and Scheme Specific Risks.

Standard Risks

Mutual funds, in general, are subject to market risks, meaning the NAV is vulnerable to fluctuations depending on how the market behaves. Depending on how the market reacts to certain events and how the NAV’s fluctuate, your holdings or portfolio value would change accordingly. Some common elements that impact a fund’s value include the risk of settlement, the risk of liquidity, trading volumes of stocks, or the simplest risk of losing your capital.

Some of the factors that affect the market such as trading volumes, different market related factors, different interest rates, factors affecting the capital investments etc. also impact your mutual fund. Though looking at the past performance of a mutual fund offers significant insight into the fund’s capabilities, it does not guarantee future performance. Another standard risk with a mutual fund is that there isn’t any guarantee on the return or the fulfilment of fund’s objectives. Similarly, one must not read a great deal into the name of the mutual fund as it does not indicate a fund’s future returns or prospects or its quality.

Scheme Specific Risk Factors

HDFC Top 100 fund invests more than 97% of its total assets into equity and equity based instruments. Any fluctuation in these stocks will directly impact your holding and portfolio. Any securities that are not listed on the stock exchanges have higher inherent risks involved when compared to securities that are listed. Their absence from the stock exchanges puts a lot of liquidity risks. The debt and money market instruments in the mutual fund also impact the NAV of the fund. Any change in the interests of the involved instruments will impact the NAV of HDFC Top 100 fund.

It might so happen that the fund manager receives a substantial number of requests for redeeming units. In such cases, the fund manager must sell some of the assets to account for it which might call for a rebalancing of the fund and its core structure. Since the fund has more than 97% of its assets into the equity market, the risk factor involved with the fund is moderately high.

Investment Plans

Just like any other mutual fund, for the same plan, there are different options that you can opt for. The selection process of the option largely depends on your needs and requirements. Here are the four different options available for investors.

Growth Option

This is one of the most commonly selected options as far as mutual funds are concerned. When you opt for a growth option, you do not receive any returns immediately. Returns can be categorized as interest, dividends, bonus or gains. An investor gets to realize the gains only when they redeem their units. You can think of it as an investment in gold. You buy gold at a certain price and sell it only when it exceeds the initial price. The difference between the two is your gain.

Dividend Option

As the name suggests, when you opt for this option, you get the returns in the form of dividends. When the fund value swells substantially, the fund manager will decide on distributing the gains in the form of dividends. The only thing to be careful of is that dividends are not guaranteed. Thus, you cannot completely rely on them as a source of income.

Direct Option

When you choose to buy a mutual fund directly from an asset management company, it is called a direct plan. These plans do not have any commissions or intermediaries involved, translating into lower expense ratios, thereby, ensuring slightly higher returns as compared to regular funds. The NAV is also different when compared to regular funds.

How to Apply

If you wish to buy HDFC Top 100 fund, there are two major ways you can do so, online and offline. This, again largely depends on your personal preference.

Online

There are various portals that you can use to invest in mutual funds. You could either directly create an account with an Asset Management Company or create an account with third party wealth creation websites and invest. During the account creation process, you will have to submit all relevant documents. Once you are done, you can select HDFC Top 100 fund and either choose to do Lumpsum investment or create a SIP.

Offline

If you are someone who likes to go old school, you can contact any representative from HDFC Mutual Fund or a distributor. You must procure the KYC form and submit the form along with supporting documents. Along with all the documents, you must provide a cheque along with the amount that you wish to invest in the fund. Post the submission of KYC form and other documents, HDFC will allot the units to you.

FAQs on Hdfc Top 200 Fund

What is HDFC Top 100 Fund?

It is an open-ended equity-based mutual fund that invests in large cap companies. This mutual fund is ideal for you if you are someone who is looking for an investment option from a long-term point of view.

Is HDFC Top 100 good fund?

Since its inception, the fund has provided its investors with steady returns year on year. Its dependence on large cap stocks ensures a steady stream of returns over a period of time. The fund has successfully outperformed the indices several times, making it a good option to invest.

Which is best HDFC Mutual Fund?

HDFC Top 100 is one of the better funds from the house of HDFC Mutual Funds. Its performance from its inception, coupled with the factor that it is in capable hands, make it a good mutual fund to invest your money in.

Which HDFC SIP is best?

You can invest in HDFC Top 100 fund with the help of SIPs as well. You would have to make an initial investment of INR 5000, post which the subsequent SIPs can be of INR 1000 or its multiples.

How do I buy HDFC Top 100 Fund plan online?

You can visit the official website of HDFC Mutual fund and opt to buy the mutual fund directly. Some investors invest in HDFC Top 100 fund directly with the help of net banking facility, while others invest via distributors or third-party websites. Assuming that your KYC forms are filled up and submitted, you just need to select the fund and make the payments to proceed.

How do I contact HDFC Top 100 Fund Company?

You can call at 1800 3010 6767 or send an email to cliser@hdfcfund.com. Alternatively, you can send an SMS ‘HDFCMF’ to 56767 and the company will get back to you at the earliest.

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