Mutual Fund that constantly beat benchmark returns:A CAGR of 59% in one year, 31% in 5 years and more than 20% in 10 years can make any investor happy. JM Value Fund has shown such performance in the last decade. This fund has also given the best returns in its category during the 5-year and 10-year periods.The special thing about this fund, which comes under the category of value mutual fund, is that it has consistently performed well and has given better returns than its benchmark during every period. We will look at the data of this past performance of the scheme in detail later, but first let us understand what is meant by value fund?
What is the meaning of value fund?
Value funds are mutual funds that invest in stocks whose current valuation is below their fair value. The current price of such stocks remains low due to market volatility or any negative sentiment. But they are likely to give good returns to investors in the future after achieving their correct valuation. Value funds are suitable for those investors who want balanced and stable returns in the long term.
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Past Performance of JM Value Fund (Direct Plan)
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1 Year Return: 58.93% (Benchmark index return 38.67%)
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How much the scheme has outperformed the benchmark in 1 year: 20.26%
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5-year return: 31.38% (benchmark index return 23.25%)
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How far the scheme has fared from its benchmark in 5 years: 8.13%
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10-year return: 20.45% (benchmark index return 15.19%)
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How far the scheme has fared from its benchmark in 10 years: 5.26%
It is clear from the performance figures that this fund has outperformed its benchmark by a huge margin in every period. Especially the difference of 20.26% in 1-year returns and 8.13% in 5-year returns is quite big.
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Benefits of investing through Monthly SIP
JM Value Fund has also given excellent returns to those who invest through SIP. The annualized return of this scheme on SIP in 10 years has been 24.07%. If an investor would have started a monthly SIP of Rs 5000 in this fund 10 years ago, then his current fund value would have been Rs 21,45,330. Whereas during this period, he would have invested only Rs 6 lakh in the scheme.
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What is the reason for consistently giving better returns than the benchmark
JM Value Fund has invested primarily in undervalued stocks, which overcome market volatility in the long run and give good returns. This fund invests in companies whose shares may be cheap right now, but whose fundamentals are strong. Such companies perform better over time, which increases the returns of the fund. Apart from this, the portfolio of this fund is a good balance of large cap, mid cap and small cap stocks, which proves to be very beneficial in the long term.
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Asset Allocation of JM Value Fund
According to the latest data, equity accounts for 97.44% of JM Value Fund’s portfolio and cash and cash equivalents account for 2.56%. 38.59% of equity investment is in large caps, 34.6% in mid caps and 26.81% in small caps. You can see the details of the company’s top 10 share holdings below.
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Top 10 stock holdings of JM Value Fund
- HDFC Bank
- Infosys
- SBI
- Suzlon Energy
- NTPC
- ICICI Bank
- Tata Motors (DVR)
- LIC Housing Finance
- Hindustan Petroleum
- Larsen & Toubro
Should you invest in this fund?
JM Value Fund is suitable for those investors who want to invest for the long term and have the ability to take high risk for better returns. The riskometer of this fund is ‘Very High’, which means that this fund is full of risk, but if you have time and patience, it can give you good returns. If you are a long-term investor and are ready to take risks, then this fund can be a good option for you. But before investing, you should think carefully about your risk taking capacity and investment horizon.
(Disclaimer: The purpose of this article is only to provide information, not to recommend investment in any scheme. Past returns of equity mutual funds cannot be considered as a guarantee of similar performance in future. Take any investment decision only after getting complete information and taking advice from your investment advisor.)
