Should you invest in Peerless 3 in 1 Child Plan Mutual fund?

Peerless 3 in 1 mutual fundShould you invest in Peerless 3 in 1 Child Plan Mutual fund?


Peerless Mutual Fund has indicated on 15th May, 2015 that it has re-launched 3-in-1 Child Plan Mutual fund. This plan was originally launched on Apr-2011 and Peerless Fund Management Company Limited (PFMCL) indicates that this mutual fund plan provides gold as main asset class which helps for risk adjusted returns. What is this Peerless 3-in-1 Child Plan Mutual fund? Is it worth investing in such plans? Are there any alternatives to Peerless 3 in 1 Child Plan Mutual Funds? Should you invest in Peerless 3 in 1 Child Plan Mutual fund?

Also Read: What are Opportunity Mutual Funds and you can identify good mutual funds under this category?




What is Peerless 3 in 1 Child Plan Mutual Fund all about?


This is open ended hybrid / balanced mutual fund scheme which invests in debts, gold ETF and equity. This scheme aims to optimize risk and provide better risk adjusted returns. This scheme was originally launched in Apr-2011 by introducing gold as main asset class along with equity and debt assets in its portfolio. This scheme has allowed anyone to invest in their child's name who is less than 18 years of age.

Why Peerless re-launches 3 in 1 Child Plan Mutual fund now?





Peerless Mutual Fund Managing Director and Chief Executive, Rajiv Shastry say that “The problem with earlier scheme was it was provided option to invest on minor child up to 18 years only. In re-launched scheme, anyone can invest in this scheme. With this product we are introducing the concept of gold as a risk management tool to manage portfolio risk”. Rajiv adds saying this is an innovative research driven product which would attract investors. Peerless Mutual fund got SEBI approvals to re-launch this scheme now and this would open for subscription shortly. This should be ideally called now as 3 in 1 scheme instead of 3 in a 1 child plan scheme.

What is the portfolio of Peerless 3 in 1 Mutual Fund Scheme?





Peerless 3 in 1 Mutual fund scheme portfolio consists of investment of 30% in gold, 20% in equity and balance 50% in fixed income options.  Since equity exposure is low, impact of stock markets SENSEX/NIFTY on such schemes would be less.




Should you invest in Peerless 3 in 1 Child Plan Mutual fund?


Peerless 3 in 1 Child Plan Mutual fund schemes invests in gold, equity and debt options. If you see in last 3 years, the scheme has given 8% annualized returns which is an average return which you would have got even in debt funds. If you have invested Rs 1,000 per month in this scheme in last 36 months, your invested value would have been Rs 36,000 and your fund's value would have been Rs 41,000. Since this is a hybrid scheme, we can compare this MF scheme with couple of best hybrid / balanced mutual fund schemes like ICICI Balanced fund and HDFC Balanced Funds. If one would have been invested Rs 1,000 per month in the ICICI Balanced fund, your invested would have been Rs 36,000 and fund value would have been Rs 54,000. Similarly, if you have invested in an HDFC Balanced fund for 3 years with Rs 1,000 per month, your invested value is Rs 36,000 and fund value would have been Rs 55,000. Means, if you compare Peerless 3 in 1 mutual fund with these 2 top funds, such scheme has provided very less returns. While scheme objectives could be good, but ultimately returns from mutual funds mater. It is not worth investing in such schemes.

Readers, what is your view about this Peerless 3 in a 1 Mutual fund scheme? Do you feel, there are any merits of investing in such schemes?

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Suresh

Should you invest in Peerless 3 in 1 Child Plan Mutual fund



The Author

Suresh KP

Suresh KP i.e. me have written 1,500+ articles on this blog. I love doing analysis on various Best Investment Plans like mutual funds, Stocks, IPO's, NCD Bonds, Insurance products. If you like our blog, you can share some of the good articles on your Facebook or Twitter. This would be the BIGGEST gift which you would be giving to us.

2 Comments

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  1. i think in general all child plan do not offer good returns.

  2. Thank you very much for nice article.

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