A value fund is a mutual fund that follows the concept of investing in stocks which are undervalued. The reasons for being ‘undervalued’ is due to temporary factors, thus, having a chance of providing high returns as compared to peers once valuation is at par.
Their main focus is to identify the stocks that are available at a discounted price or may be at a price that is not reflecting their true worth.
Returns 3Y: 12.43%
Return 3Y: 15.98%
Return 3Y: 19.88%
Return 3Y: 19.37%
Return 3Y: 17.88%
To begin with, the biggest challenge of value mutual funds is estimating their fair value which is both an art and science. For an avid investor, the investment seems to be easy, but when we talk about the new investor, the financial road turns out to be tedious. Therefore, taking care of this, Gulaq got a way-out by making an easy process of doing an investment by anyone. Few taps of sign-up and Alas! You are investment ready. Don’t forget to check your KYC for FREE. Also, the investor can filter her requirements according to the goals, returns, risks, and horizons. That simple!
Value funds work on the principles of value investing. In this case, the fund manager tries to pick those companies which are not evaluated on their fair value and available at discount price. All the stocks are based on value-based vs growth based. Growth stocks are those where the investor is willing to pay an additional or high premium because the company is growing at a faster rate. Value based fund grows in the longer term. Hence, A value fund manager buys undervalued stocks that have a potential for appreciation, but usually ignored by day to day investor. To pick those value stocks, the fund manager makes certain strategies to pick up those stocks which are trading below due to some inherent market inefficiency. To determine a fair value for the company stocks, fund managers evaluate future cash flows of the company which is quite challenging. But due to their vast experience and a long track record out of performance in their domain, they can provide good returns to their customers in the long run.
Value investing is considered as one of the most successful equity investment strategies. They tend to carry risk, but they are outweighed by their advantages. Any investor who is looking for long term investment say a period of more than 7 to 8 years then the value funds are great investments. Although volatility will be high, but most of the occasion returns outclass their respective peers. It is always advised by the experts to have 25% of your portfolio in value fund. If an investor has patience, then in some cases it provides exceptional returns to their respective investment.
Gulaq provides you the simplest and an easiest way to invest. It has no commission, no account fees, no hidden charges as well as you can be investment ready in less than 30 seconds. Our platforms provide the most user-friendly experience.
Attention Investor
Investments in Mutual fund & Securities Market are subject to market risks. Please read the scheme information and other related documents carefully before investing. Past performance is not indicative of future returns. Please consider your specific investment requirements before choosing a fund or designing a portfolio that suits your needs. Terms and conditions of the website are applicable.
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Mutual fund investments are subject to market risks, read all scheme documents carefully.
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