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Should I sell Aditya Birla SL Pure Value Fund?

If you have any mutual fund queries, message on ET Mutual Funds on Facebook. We will get it answered by our panel of experts.

ET Online|
Nov 12, 2019, 03.03 PM IST
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I have invested a lumpsum in Aditya Birla Sun Life Pure Value Fund (Regular, Growth) in early 2018 and currently it is offering negative returns. The fund is not performing well, even though the market is up since the last two months. I have compared with other funds, and found that their NAVs have risen, but this fund’s NAV is below the benchmark index. Please advise me what should I do.
-Anal Vyas


You are investing in a value-oriented scheme. The value-oriented category is among the poor performers in the last year. The category has offered around 2.52% in the last one year. Aditya Birla Sun Life Pure Value Fund was the second in the list in 2017, with 56% returns. However, the scheme has lost 22 per cent in 2018.

The value-oriented category, as the name suggests, picks up undervalued stocks in the market, and wait for a long period to realise the full value of the stock. That means you should invest in these schemes only if you are a devotee of value investing and you have a very long investment horizon. Many mutual fund advisors believe that growth strategy would continue to do well in India and investors should use value-oriented funds only as a diversification tool. However, many qualify conscious investors swear by value investing strategy.

You have two choices. If you are not a great fan of value-oriented strategy, you may stop your investments, and invest in a growth-oriented scheme that is in line with your risk profie. Two, if you believe in the strategy, you can give some more time to the scheme to perform.
(If you have any mutual fund queries, message us on ET Mutual Funds on Facebook. We will get it answered by our panel of experts.)
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