Templeton India Equity Income Fund yields over 14% returns in 5 years — should you consider?

If you are unsure of which equity funds to prefer, the best way out is to put your money in a dividend yield fund. The idea is to generate income through dividends from stocks that can be re-invested over a period to create wealth.

Those unsure of which dividend stocks to invest in, can park their money in dividend yield funds that continue to grow, irrespective of which way the market sways. Take, for example, the Templeton India Equity Income Fund which earned more than 14 percent returns over five years. This moderately high-risk fund has yielded nearly 15 percent returns since its inception which is very similar to its category average.

Assuming a systematic investment plan (SIP) of ₹10,000 every month in this fund, investors would roughly earn:

Most of the fund’s holding is in equity holdings, out of which 61.08 percent of the money is parked in large-cap investments, 11.22 percent in mid-cap investments and 4.66 percent is put in small-cap investments. The remaining is put into other investments.

The top industry exposure in this fund includes:

Investing in this fund

If you are inclined to invest in this fund, you must put in a minimum lump sum investment amount of ₹5000 post which you can put money in this fund through easy SIPs starting from ₹500. You may put money in lump sums or through SIP investments depending on your ease and availability of money. A lot depends on your financial goals too.

There is no entry load though investors must pay a one percent exit load if they redeem their investments within a year.

This fund is best suited to those interested in continuing to earn returns irrespective of whether the fund invests in large-cap, mid-cap or small-cap stocks.