Diversify your investment portfolio by style to include value funds

Don't exit growth-style funds as they may benefit next from a shift in investor preference

One category that has done well in the past year, when most categories of equity funds did poorly, is value funds. This category, which has 19 funds with assets under management of Rs 73,524.4 crore, has earned an average return of 14.2 per cent via the systematic investment plan (SIP) route over the past year.

Growth-oriented funds invest in stocks whose earnings per share (EPS) are growing at a fast pace. Value funds, on the other hand, invest in stocks of companies that have the ability to sustain their earnings growth but whose valuations are temporarily suppressed due to a