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Union Mutual Fund
Union Mutual Fund
AUM
4,201 Cr
Schemes
31
Union Mutual Fund
Union Mutual Fund
Investment Objective
Union MF Equity funds aim at providing investors with an opportunity to grow wealth over the long run. These funds primarily invest in equity and equity related instruments in a given proportion as per the fund’s mandate specified in its scheme information documents. The fund manager will pick quality stocks after an in-depth analysis to ensure that the portfolio returns remain in line with the expectations and category benchmarks. The underlying stock-picking strategy may be value/growth/ or growth at reasonable prices. The capital appreciation results upon increase in the underlying stock prices over a given investment horizon. It also occurs when the dividends declared by the fund are reinvested to purchase additional units of the scheme. However, the Union MF Equity fund doesn’t guarantee that the investment objective will be achieved.
Risks Involved
Union MF Equity funds carry moderately high to high market risk as compared to debt funds and balanced funds. The fund value may go up/down as and when the underlying stock price changes. The stock prices might be affected by price and volume changes in the stock markets, interest rates, exchange rates, government policies, tax laws and other economic developments. The extent of risk also depends on the level of portfolio diversification. Sector / theme-based Union MF Equity funds possess higher market risk than diversified equity funds. Similarly, large-cap equity funds will have lower risk as compared to small-cap / mid-cap equity funds. Investors may consider their own risk tolerance before investing in a scheme.
Return Potential
Returns are incidental to the risk assumed by an investor. Union MF Equity funds generate higher returns than debt funds and balanced funds. Historically, these funds have known to deliver average returns of around 12% over a period of more than 5 years. However, Union MF Equity funds do not guarantee assured returns and the fund performance may vary from one period to another. Owing to higher risk, a focussed fund may carry a higher return potential as compared to a diversified equity funds. Conversely, large-cap funds are known to provide stable returns across market cycles. To boost returns, one may consider adding a few small-cap / mid-cap funds to the overall portfolio for diversification.
Who should invest?
Union MF Equity funds are suitable for investors who are seeking long-term capital appreciation over a period of 5 years or more. Since the fund value may go up / down as per the market movements, these funds are meant for investors with relatively higher risk tolerance. The high-return generating potential of Union MF Equity funds makes them ideal to achieve long term goals like children’s education, retirement planning and buying a home. To realise the full potential of equity funds, you need to stay invested throughout the given investment horizon which usually should be 10-12 years or even beyond. This may also mean parking only such surpluses in these funds which you won’t need in the near future and are meant for long term investments.