Sarabjit K Sen

Multinational Companies (MNC) Fund is a thematic category fund. In this, investors’ money is invested in MNC shares. While their returns have not been impressive in recent years, a different picture emerges if we look at the long-term averages. It has outperformed the Nifty 50 Total Return Index in 10 years.

Hence, MNC Fund is better suited for investors who want to earn higher returns than the benchmark over the long term. SBI Mutual Fund, UTI, Aditya Birla Sun Life and ICICI Prudential offer active funds in the MNC category. Kotak Nifty offers ETF based on MNC Index. The country’s mutual fund companies manage assets worth Rs 12,315 crore in the MNC fund category.

1. Well diversified portfolio
MNC funds invest in shares of companies with more than 50% foreign promoters’ stake. The benchmark for this category of schemes is Nifty MNC Index. It has 30 shares of MNC. His business is in sectors like FMCG, Automobile, Healthcare, Metal, Mining, IT.

2. Excellent return potential because
India is becoming a manufacturing hub for global companies. Companies which were till now dependent on China for manufacturing outsourcing have started shifting the plant to India. Hence, MNC funds can be successful in providing consistent returns over the long term.

3. Quality Investment
MNC funds are considered quality investments. They invest in established global companies. These are companies with well-known brands, low debt and a track record of performing well even under adverse conditions. That is why more stability is seen in such funds. They perform well even when the market is falling.

4.Who should invest?
MNC is a better thematic fund for those who want to invest in equity funds for 3-5 years. These are better for those investors who do not want to take much risk. But limit the proportion of thematic funds to 20% in the equity portfolio. The stake of the MNC fund should also not exceed 10%.