Mutual funds that focus on investing in multinational companies (MNCs) have emerged as a high-return option for investors. These funds are known for investing in leading companies that operate across various sectors, providing a balanced and diversified portfolio. In the last year, MNC mutual funds have generated returns ranging from 35% to 50%, making them a strong option for people looking for good returns.
Why MNC Mutual Funds Are Attractive to Investors
MNC mutual funds are a type of thematic fund, meaning they invest in companies that belong to a particular theme—in this case, multinational corporations. These companies operate not only in India but also have significant business operations globally. They usually enjoy strong corporate governance, stable cash flow, and transparent management. As a result, they often provide a safer and more profitable investment option.
What makes these funds particularly attractive is their dividend yield. Multinational companies are known to offer high dividends to their shareholders, and mutual funds that invest in these stocks pass these dividends on to the investors. Additionally, investing in these funds provides the benefit of diversification across different sectors, reducing the risks associated with investing in just one sector.
Best Performing MNC Mutual Funds
Several MNC mutual funds have performed exceptionally well over the past year, with growth ranging from 35% to 50%. Here’s a look at some of the top-performing funds and their key stocks:
- Kotak Nifty MNC ETF: 48.22%
Key holdings include HUL, Maruti Suzuki, Nestle India, Siemens, and Britannia Industries. - UTI MNC Fund: 38.19%
Stocks in the portfolio include Maruti Suzuki, United Breweries, Nestle India, Vedanta, and 3M India. - Aditya Birla Sun Life (ABSL) MNC Fund: 37.49%
Major investments are in Maruti Suzuki, Bayer Cropscience, Cummins India, and Honeywell Automation. - ICICI Prudential MNC Fund: 36.36%
Leading stocks include HUL, Sun Pharma, Siemens, Dabur India, and Gland Pharma. - HDFC MNC Fund: 34.88%
Top shares include HUL, United Spirits, Ambuja Cements, and Maruti Suzuki.
These funds have consistently provided high returns due to their strategic investments in companies that lead their sectors and have a global presence.
Investment Strategy of MNC Mutual Funds
The investment strategy of these funds is to focus on multinational corporations, which generate revenue from both domestic and international markets. This global reach opens up more opportunities for growth and stability, even during market downturns. The companies in MNC mutual funds’ portfolios are known for being adaptable across different market cycles, helping investors get consistent returns.
Benefits and Risks of MNC Thematic Funds
While MNC mutual funds offer great growth potential, they also come with their own set of benefits and risks. These funds limit their investments to multinational companies, which can reduce diversification. However, the global exposure of these companies provides growth opportunities not just in India but across the world.
Benefits include:
- Strong Global Brands: MNCs have well-established brands, making them less volatile in times of uncertainty.
- Research & Development: With significant R&D investments, these companies are constantly innovating, which helps them stay ahead in their sectors.
- Diversification: Investing in multinational companies across various sectors adds diversification to your portfolio, lowering risks.
However, the risk remains high as these funds are tied to the performance of the companies within the theme. If multinational companies face global challenges, the returns may fluctuate. But overall, MNC funds have shown resilience and flexibility, making them a preferred choice for long-term investors.
