Quantum Long Term Equity Fund
ia Quantum Long Term Equity a good fund, should i invest in Quantum Long Term
2012 4 17
Quantum Long Term Equity is a good fund
Our recommendation for fresh investment: Yes
Our recommendation for existing investment: Hold
Quantum Long Term Equity Fund is one of the better performing funds in its category. This
fund is managed by Atul Kumar. He has 11 years experience in this field and has been
managing the fund since November 2006. Nilesh Shetty has joined the fund management
responsibility since March 2011. This fund follows the buy and hold strategy for stocks. The
portfolio bears below average risk yet gives high returns compared to its peers. If you
already hold units in this fund you can continue to do so. New investors can try this fund
Invest for what?
You can invest in Quantum Long Term Equity Fund to grow or create wealth. Do not look at
making quick bucks here. Stay invested for long term. Quantum Long Term Equity Fund is
suitable for goals that is at least 5 years away from now. In case your goals are less than 5
years away, then we advise you to look at other options.
Where does this fund invest your money?
Quantum Long Term Equity Fund is a large cap fund which means most of your money will
be invested in giant and large companies. And just to give kicker returns the fund has some
exposure in mid cap companies as well. Large cap companies tend to be stable compared
to mid cap and small cap companies. The portfolio has 31% exposure to stocks of mid cap
companies, 4% exposure to stocks of small cap companies and 65% exposure to stocks of
large cap companies.
How much to invest?
Minimum one time investment is Rs 500 and minimum SIP is Rs 500 per month. Do not
make Quantum Long Term Equity Fund as part of your core portfolio. Core portfolio is
investments that are made for your basic goals and makes up about 70% of your
investment portfolio. Quantum Long Term Equity Fund can be part of your satellite portfolio.
Do not do the mistake of investing in too many mutual fund schemes. At any point of time
do not have more than two mutual fund schemes in your core portfolio.
How has it performed in the past?
If you had invested Rs 1 lakh when the fund was launched in March 2006, your value of
investments would be around Rs 2 lakhs. If you had invested Rs 1 lakh five years back it
would have become Rs 1.7 lakhs. The performance has been better or similar to other
mutual funds in this category. The fund has been giving at around 11% every year for those
who stayed invested for last 5 years.
Assume you had invested Rs 10,000 every month in Quantum Long Term Equity Fund
through SIP for the past 5 years today you would have around Rs 8.6 lakhs.
How will it perform in the future?
Needless to say no one can predict the future of markets. We have firm belief in the future
prospects of the Indian economy. If the Indian economy grows at 9% then the leading
companies tend to de well. When the companies do well their stock prices follows their
performance. So if you expect the economy to grow at 9% then you can expect top
performing mutual funds to give you returns in excess of 15%. We advise you to avoid too
much of star gazing and future prediction. Be reminded that equities are one of the asset
classes that have the potential to beat inflation. Your aim for core portfolio should be to
When to review the performance?
Once you invest in the fund do not get into the habit of checking the NAV daily or monthly.
Review the performance once a year. Too much attention is not good.
When to enter?
Now! There is no good time to invest rather than now. Do not try to time the market and
especially if it is an SIP. Do not follow news channel and other experts trying to know the
right time to invest. In the long run it does not matter. Mutual fund is unlike a stock where
you are looking at the right price. This job will be done by the mutual fund scheme manager.
If you have planned your investments and decided on the amount you want to invest do not
think further, just go ahead.
When to exit?
Withdraw when your goals are closer to achievement. Do not remove the money when the
markets go up or down. Do not panic. Stick to your goals.
What are the tax implications?
The returns in a mutual fund are absolutely tax free, provided you do not withdraw within 1
year. Quantum Long Term Equity Fund does not qualify for sec 80C ELSS benefits.
More alternatives for core portfolio
HDFC Top 200 Fund
Canara Robeco Equity Diversified Fund