ETMutualFunds considered all equity and equity-oriented schemes with the dividend payout option for this study. We considered five years, starting from February 15, 2018 to February 15, 2023. We got a total of 156 dividend payout schemes with different frequencies. We filtered out the schemes that offered leads than 40 dividends during the five-year period. That left us with schemes that have paid more than 40 dividends in five years. Around 24 mutual fund schemes have offered regular dividends in a five-year horizon, with the majority of schemes having monthly payout option, the study showed.
As said earlier, mutual fund schemes pay dividends out of the profits they make. So, each time a scheme declares a dividend, its NAV goes down proportionately. This option is only recommended to retirees or to investors looking for regular income from their investments. Even they should opt for Systematic Withdrawal Plan if they want money regularly without fail.
Here are the equity mutual fund schemes that paid more than 40 dividends in the last five years :
Source: ACE MF, Data for period February 15 2018 to February 15 2023
HDFC Balanced Advantage Fund(IDCW) has offered the highest returns from dividends ( 64.55%) and gave around 57 dividends during the period of analysis. The scheme offered a total return of 78.05% during the five year horizon based on NAV. The second in the list was Edelweiss Balanced Advantage Fund-(M-IDCW) which offered a return of 54.13% from dividend and gave around 59 dividends during the period. The scheme offered 60.79% returns during the five-year horizon.
The scheme that gave the highest number of dividends was ICICI Prudential Multi-Asset Fund (IDCW-Payout). The scheme gave around 61 dividends during the period of analysis, but it could offer only around 45.46% return from dividend.
