Mutual funds: If you invested Rs 100,000 at the start of this scheme, it would have ballooned to Rs 84,000 by now.

Investment experts often recommend that you can easily achieve your long-term financial goals by investing in mutual funds on a regular basis. While some of their claims and assurances are convincing, they may seem too good to be true.

So what’s the exit? Well, a more reliable and empirically based way of assessing a scheme’s growth potential is to evaluate its past returns to gauge the returns you would get as an investor.

Well, it might lead to a feeling of FOMO (Fear of Missing Out) but if you think positively, you can take this as a lesson to be learned and thereby start investing in one of the schemes that bridge the gap in mutual funds. portfolio.

So, without further ado, we have put the spotlight on SBI Contra Fund and examined the returns it has provided over the past few years.

Let’s assume that someone invested INRWhen the plan was launched, it was $100,000, but how much has it increased over the past few years? But before that, let’s understand what the Contrafund category refers to.

contrafund

These are equity mutual funds that follow a contrarian investment strategy with at least 65% comprising of equities as per Sebi’s classification of mutual fund schemes.

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As you can see in the table below, investments made in SBI Contra Fund 1 year ago. INRThe scheme has increased by $147 million since its 47% increase in the past 12 months.

Over the past three years, the scheme has returned 29.72 percent.This means if someone had invested INRIf it was $100,000 three years ago, INR2.18 million.

Similarly, INR100,000 will swell INR$3.02 million over 5 years with compound interest growth of 24.69%.

in 10 years INR100,000 would have grown INRIt grew at an annualized return of 18.91% to $565 million.

(Source: sbimf.com, AMFI)

Similarly, if the investment was made at the beginning of the scheme, the CAGR return on the investment would be 19.64 percent; INR8.475 million.

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However, it is important to point out that past returns are to be taken as an indicator and are not proof of a plan’s future potential.

All equity mutual funds, like stocks, are risky investments and should be invested based on your personal risk appetite.

Note: This story is for informational purposes only. Please consult a SEBI registered investment advisor before taking any investment related decisions.