You have a lot to loose if these ‘top six dividend yield funds’ are ignored

With investors looking for a strategy to consistently outperform markets i.e Sensex & Nifty, chances are that investors may chase growth and miss on Dividend Yielding Stocks or Funds.

Several studies have shown benefits of investing in high dividend yielding stocks. As a strategy one may adopt an investing style where the funds are parked in those stocks that are high on dividend yields.

Dividend Yield Funds are essentially those funds that invest in stocks whose dividend yield is higher than that of Nifty 50 and or Sensex.

BNP Paribas Dividend Yield Fund (G) - 17.35 per cent , Tata Dividend Yield Fund (G)- 15.33 per cent, Birla SL Dividend Yield Plus (G)- 12.99 per cent, Principal Dividend Yield Fund (G)- 13.97 per cent, HSBC Dividend Yield Equity Fund (G)- 13.27 per cent and UTI Dividend Yield Fund (G)- 11.04 per cent are all amongst the best performing dividend yield funds with a consistent performance track record of over five years.

The average returns for these funds over five years ranges from 11 per cent to 17.35 per cent on an annualised basis with BNP Paribas Dividend Yield fund clocking the maximum returns over a five year period.

Over a one year period the returns for the said funds range from 9 per cent to 14.54 per cent, thus outperforming the benchmark indices such as Sensex and Nifty 50. The top performer has been Principal Dividend Yield Fund (G) in the category, if we consider one year time frame.

BNP Paribas fund - 9.65 per cent , Tata Dividend Yield Fund- 10.38 per cent, Birla SL Dividend Yield Plus Fund- 9.31 per cent, HSBC Dividend Yield Equity Fund- 14.32 per cent, UTI dividend Yield Fund - 11.42 per cent and Principal Dividend Yield Fund- 14.54 per cent all have outperformed the benchmark index.