When it comes to investing in mutual funds, large cap funds are considered a safer option for conservative investors. Large cap mutual funds invest in companies with a large market capitalization, which are typically well-established and have a history of stable performance. These funds are known for their relatively lower risk compared to other types of mutual funds, making them a popular choice for investors seeking a balanced portfolio with potential for long-term growth. In this blog, we will explore the top 5 large cap mutual funds to consider in 2021, based on their historical performance and financials.
- HDFC Top 100 Fund HDFC Top 100 Fund is one of the most popular large cap mutual funds in India, managed by HDFC Asset Management Company. The fund has a proven track record of consistent performance, delivering an average annual return of around 15% over the past 5 years. The fund invests in a diversified portfolio of large cap companies across various sectors, with a focus on quality and growth-oriented stocks. The fund has shown resilience during market downturns and has a low expense ratio, making it an attractive option for long-term investors.
- ICICI Prudential Bluechip Fund ICICI Prudential Bluechip Fund is another top-performing large cap mutual fund that has consistently delivered strong returns over the years. Managed by ICICI Prudential Asset Management Company, the fund has generated an average annual return of around 13% over the past 5 years. The fund follows a blend of growth and value investment style and invests in a diversified portfolio of large cap companies with a focus on quality and sustainability. The fund has a relatively low risk profile and has a long-term track record of beating its benchmark, making it a popular choice among investors.
- SBI Bluechip Fund SBI Bluechip Fund is a well-known large cap mutual fund managed by SBI Mutual Fund. The fund has a consistent track record of delivering competitive returns, with an average annual return of around 14% over the past 5 years. The fund follows an active management approach and invests in a diversified portfolio of large cap companies with a focus on quality, growth, and value. The fund has a relatively low expense ratio and has been known for its ability to outperform its benchmark, making it a preferred choice among investors.
- Axis Bluechip Fund Axis Bluechip Fund is a relatively newer entrant in the large cap mutual fund space but has quickly gained popularity due to its impressive performance. Managed by Axis Asset Management Company, the fund has delivered an average annual return of around 17% over the past 5 years, outperforming its benchmark. The fund follows a growth-oriented investment style and invests in a concentrated portfolio of large cap companies with a focus on quality and high-growth potential. The fund has a relatively higher risk profile compared to other large cap funds but has the potential for higher returns, making it suitable for aggressive investors.
- Aditya Birla Sun Life Frontline Equity Fund Aditya Birla Sun Life Frontline Equity Fund is a reputable large cap mutual fund managed by Aditya Birla Sun Life Mutual Fund. The fund has a long-term track record of delivering consistent returns, with an average annual return of around 13% over the past 5 years. The fund follows a blend of growth and value investment style and invests in a diversified portfolio of large cap companies with a focus on quality, growth, and sustainability. The fund has a relatively low risk profile and has been known for its ability to generate stable returns over the years, making it a reliable option for conservative investors.
Conclusion
Large cap mutual funds can be a great addition to any well-diversified investment portfolio, offering stability and potential for long-term growth. The top 5 large cap mutual funds mentioned above – HDFC Top 100 Fund, ICICI Prudential Bluechip Fund, SBI Bluechip Fund, Axis Bluechip Fund, and Aditya Birla Sun Life Frontline Equity Fund – have shown consistent performance and are managed by reputable asset management companies in India.
Before investing in any mutual fund, it’s important to consider factors such as historical performance, expense ratio, investment strategy, risk profile, and the reputation of the fund manager. It’s also crucial to align your investment goals and risk tolerance with the fund’s objectives and portfolio composition.
It’s important to note that mutual funds are subject to market risks and past performance is not indicative of future results. It’s always recommended to do thorough research, read the fund’s offer documents, and consult with a financial advisor before making any investment decisions.
In conclusion, large cap mutual funds can be a suitable option for conservative investors seeking stability and potential for growth. The top 5 large cap mutual funds mentioned above are worth considering for your investment portfolio in 2021, but it’s important to do your due diligence and consult with a financial professional before making any investment decisions. Happy investing!
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Frequently Asked Questions (FAQs)
What are large cap mutual funds?
Large cap mutual funds are mutual funds that primarily invest in companies with large market capitalization. These companies are typically well-established and have a proven track record of stability and growth.
How are large cap mutual funds different from other types of mutual funds?
Large cap mutual funds differ from other types of mutual funds, such as mid cap or small cap funds, in terms of the size of the companies they invest in. Large cap funds invest in companies with large market capitalization, while mid cap and small cap funds invest in companies with medium and small market capitalization, respectively. Large cap funds are generally considered less risky compared to mid cap and small cap funds.
What are the potential benefits of investing in large cap mutual funds?
Investing in large cap mutual funds can offer potential benefits such as stability, lower risk compared to other types of mutual funds, and the potential for long-term growth. Large cap companies are often considered more stable and less volatile compared to smaller companies, which can make large cap mutual funds suitable for conservative investors.
What are the risks associated with large cap mutual funds?
While large cap mutual funds are generally considered less risky compared to other types of mutual funds, they are not entirely risk-free. Risks associated with large cap funds include market risk, interest rate risk, credit risk, and liquidity risk. The value of investments in large cap funds can fluctuate based on market conditions, and there is always a risk of loss of principal.
How can I select the best large cap mutual fund for my investment portfolio?
Selecting the best large cap mutual fund for your investment portfolio involves considering various factors such as historical performance, expense ratio, investment strategy, risk profile, and the reputation of the fund manager. It’s important to do thorough research, read the fund’s offer documents, and consult with a financial advisor to make an informed decision.
Can I invest in large cap mutual funds through a systematic investment plan (SIP)?
Yes, most large cap mutual funds offer the option of investing through a systematic investment plan (SIP). SIP allows you to invest a fixed amount of money at regular intervals, which can help in averaging out the cost of investment and reduce the impact of market volatility.
What is the ideal investment horizon for large cap mutual funds?
Large cap mutual funds are generally suitable for long-term investment horizons of 5 years or more. However, the ideal investment horizon may vary depending on your financial goals, risk tolerance, and investment strategy.
How are large cap mutual funds taxed?
Large cap mutual funds are subject to capital gains tax. Short-term capital gains (for investments held for less than 1 year) are taxed at the individual’s applicable income tax rate, while long-term capital gains (for investments held for 1 year or more) are taxed at 10% without indexation or 20% with indexation, whichever is lower.
Can I redeem my investment in large cap mutual funds at any time?
Yes, most large cap mutual funds offer the option of redemption, which allows you to sell your investment and receive the proceeds. However, it’s important to note that the redemption value will depend on the prevailing Net Asset Value (NAV) of the fund at the time of redemption.
Are large cap mutual funds suitable for all types of investors?
Large cap mutual funds are generally considered suitable for conservative investors seeking stability and potential for growth. However, the suitability of large cap funds may vary depending on an individual’s financial goals, risk tolerance, and investment horizon. It’s important to carefully assess your own investment needs and consult with a financial advisor before making any investment
