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Monthly Income Plans Or Income Funds – Which is the best option for conservative investor under current situation?


Current situation is tricky.Markets have faced resistance at current levels before & though market experts believe that market can offer good returns from this point,retail investors still not looking much convinced.Similarly interest rates are trending down & investment in bond funds & income funds have become more attractive.

So after viewing the current market condition,there is one flow of opinion that  monthly income plans which have 20-30% exposure in equity is a better bet.Even if market get corrected from this level there won’t be capital erosion in same proportion & if market moved up sharply there will be some equity exposure which will be helpful. similarly income funds which offers in bond funds & other debt products can offer good combination alongwith MIPs.

History shows that MIPs have offered good returns with lower risk when market have performed better.

Best Monthly Income Plans:

Sr.No Fund Name Returns Last  One Year
1. IDFC Monthly Income Plan 13.30%
2. SBI Magnum Monthly Inome Plan 13.03%
3. HSBC Monthly Income – Savings Plan 11.80%

Bond Funds:

Sr.No Fund Name % Returns – Last One Year
1. SBI Magnum Dynamic Bond Fund 12.80%
2. IDFC Dynamic Bond Fund 12.20%
3. Sundaram Bond saver 11.95%

Income Funds:

Income funds have also exposure towards bonds but since they have more diversified portfolio they carry less risk than pure bond funds.

Sr.No Fund Name % Returns – Last One Year
1. Templeton India Income Builder 11.05%
2. Religare Active Inome Fund 10.95%
3. Icici Prudential Income Opportunities 10.55%

MIP Or Bond Funds – Which one is the best?

My opinion is slightly tilted towards MIPs as probability is higher that market will have some upward movement & there is limited downside.So for conservative investor who is looking to think beyond fixed deposits can consider to blend income / bond funds along with monthly income plans with some higher weightage.

 


Category: Mutual Funds

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Information provided on this blog is for general purpose only & not investment advice.Please take advice of SEBI Registered Investment Advisors before taking any investment decision.
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