Best Taurus Equity Mutual Funds

Established in 1993, Taurus Mutual Fund was one of the first mutual funds registered by SEBI. In 1999, they merged with HB Mutual Fund, and recently they have partnered with SBI-SG Global Securities Services Pvt. Ltd. In their over 27 years of operation, they have established branches in India’s top 5 cities and have over 4000 business associates representing them in other cities. Today, they provide investment solutions across all segments and have more than Rs. 510 crores in AUM.

Taurus Mutual Fund offers more than 7 mutual fund schemes in equity and ELSS categories.

Equity mutual funds invest at least 65% of their capital in stocks/shares of companies. Equity funds are less risky than directly investing in stocks as these investments are made across companies with varying market capitalisations or in different sectors. The best Taurus equity mutual funds offer aggressive returns, more than hybrid and considerably more than debt funds, but carry more risks. 

Moreover, equity funds lower the risks by investing part of the funds in debt or money market instruments. Equity funds also generate considerable wealth in the long run in favourable market conditions, which is impossible through fixed-income instruments. 

Taurus Mutual Fund offers 7 equity mutual funds. The best Taurus equity mutual funds come in different types, depending on asset allocation, financial goals, and investment methods. 

In active funds, fund managers scan the market and conduct research to look for the best investments. Passive funds have a portfolio that reflects a popular market index, like Sensex or Nifty Fifty. 

Equity funds also come in different types based on market capitalisation, including large-cap, mid-cap, small-cap, micro-cap, and multi-cap funds. Large-cap equity funds invest in the top 100 companies, and therefore, offer stable and sustainable returns. On the other hand, small-cap funds have significant growth potential but tend to be more volatile. 

The best Taurus equity mutual funds can also be further classified based on their investment strategies. Sector funds invest in a specific industry such as Pharma, Infotech, Infrastructure, etc., while thematic funds invest in broader themes like international stocks or emerging companies. Other funds include focused funds, which invest in around 30 companies with high market capitalisation and contra funds that invest in under-performing stocks.

Factors to Consider Before Investing

Other than classifications, there are certain parameters to be aware of before investing in the top Taurus equity mutual funds. These are:

Expected returns: Generally, equity funds deliver around 10-12% returns though the actual performance can vary widely depending on market conditions. These offer higher returns than hybrid or debt funds but lower earnings than stocks. The returns also depend on the type of equity funds you invest in. For example, large-cap funds offer stable returns that hold up well even in a recession. However, small-cap funds outperform them during a bullish market. 

Risks: Even the best Taurus equity mutual fund will show returns based on market performance. However, unlike pure equities, equity funds reduce risks through portfolio diversification, meaning losses in one or more assets is balanced by gains in another asset. These funds may invest a small portion in debt or money market instruments, which offer some stability. Nonetheless, equity funds are the riskiest among other MFs, with significant chances of realising losses, especially in the short run. 

Fund objectives: Equity funds help investors realise their goals of wealth accumulation over time. Generally, a long-term financial purpose is a better option for equity funds, as it provides the time needed to combat market fluctuations. Usually, the best Taurus equity mutual funds allow easy returns without needing large capital or expertise to choose the right shares. Large-cap funds have a history of generating consistent returns. Diversified equity funds invest in shares of companies across all market capitalisations. However, investing in equity funds requires one to take calculated risks.  

Expense ratio: This refers to the fee charged by an AMC for monitoring and managing your portfolio. 

Regular and direct plans: Every scheme has two variants – direct and regular. The former allows AMCs to directly accept investments, reducing the costs of intermediaries like brokers. The latter can be subscribed via an intermediary, adding to the cost of fund management. Hence, regular plans report a higher expense ratio and lower NAV than direct plans. 

Fund performance: Historic performance of a scheme can be a reference point for its returns generated under varying market conditions. Thereby, you can gauge the fund manager’s competence in navigating through different market scenarios.

Taxability

Other than these factors, you may also want to consider the taxes levied on an equity mutual fund. 

Long-term Capital Gains Tax: If units are sold after a holding period of 1 year, an investor will realise long-term capital gains. It attracts a 10% tax on an amount exceeding Rs.1 lakh in a year.  

Short-term Capital Gains Tax: For a holding period of less than a year, short-term capital gains (STCG) tax is applicable at 15%. 

TDS: 10% TDS applies to dividend income exceeding Rs.5000 in a year. 

On ELSS: Equity-Linked Savings Scheme qualifies for tax deductions of up to Rs.1.5 lakh in a financial year.