HSBC Value Fund: SIP of 10k grows to 84 lakhs in 16 years

“Price is what you pay, value is what you get.” This timeless investing principle captures the essence of value investing. While markets often move with sentiment in the short term, over the long run, prices tend to reflect the intrinsic worth of businesses.

At HSBC Value Fund, this philosophy has remained central to the investment approach since inception. The fund focuses on identifying companies whose market price may not fully reflect their long-term fundamentals and growth potential.

THE CASE FOR VALUE INVESTING

Markets often move in cycles where certain styles dominate at different points in time. Periods of exuberance can lead to overvaluation in some pockets, while fundamentally strong companies may remain overlooked.

• Value investing seeks to capitalise on such inefficiencies by focusing on:

• Companies trading below their intrinsic value

• Businesses with strong fundamentals and sustainable earnings potential

• Opportunities where the market price does not reflect the company’s long-term prospects

This disciplined approach allows investors to participate in potential upside as valuations gradually realign with fundamentals.

WHY HSBC VALUE FUND?

• For those who seek for Long term capital appreciation through an exposure to value style companies
  The fund aims to identify undervalued stocks having the potential to deliver long term risk-adjusted returns

• The fund will focus on undervalued stocks which the Fund Managers believe are trading at less than their assessed values

• Diversified equity fund with strong value bias that aims to deliver long term reasonable risk adjusted returns

• Value style (Market price < Intrinsic value of stock) and Bottom-up approach with aim to invest across market caps and sectors

WHAT TO EXPECT IN HSBC VALUE FUND?

PORTFOLIO CONSTRUCTION APPROACH

HSBC VALUE FUND – PERFORMANCE SCORECARD

The journey of HSBC Value Fund highlights how staying invested through market cycles can potentially help investors benefit from compounding over time.

Since inception, the fund has delivered a CAGR of 15.37%, reflecting the potential of value-oriented investing over longer time horizons.

To depict the impact of disciplined investing:

• A lump sum investment of ₹1,00,000 since inception would have grown to approximately ₹10.17 lakh, translating to about 10.1 times growth.

• A monthly SIP of ₹10,000 since inception would have grown to approximately ₹84.26 lakh.

• A ₹10,000 SIP with periodic top-ups (increasing the investment amount over time) would have grown to approximately ₹1.40 crore, highlighting how gradually increasing investments may further potentially enhance long-term wealth creation.

These examples demonstrate how time in the market, disciplined investing and increasing investments as income grows can potentially help investors build meaningful wealth over the long term.

FUND FACTS

THE ROAD AHEAD

While markets may witness phases of volatility and style rotations, the principles of value investing remain rooted in discipline, patience and a focus on fundamentals.

By identifying companies trading below their intrinsic worth and maintaining a long-term perspective, strategies such as HSBC Value Fund aim to capture opportunities that may emerge across market cycles.

For investors seeking long-term capital appreciation through a value-oriented equity strategy, such an approach may offer a compelling way to participate in equity markets while maintaining valuation discipline.

“This article is part of sponsored content programme.”