Some mutual fund schemes have been rated very well by leading companies or call them research firms that rate mutual funds. There are three that we can think of that are reputed in the business of rating mutual fund schemes and have pretty high credibility. So, let's talk about the two mutual fund schemes that have a 5-star rating from Value Research, CRISIL and Morningstar.
Canara Robeco Bluechip Equity Fund
Canara Robeco Bluechip Equity Fund has been accorded a 5-star rating by Morningstar, CRISIL and Value Research. This largecap equity fund has been a consistent performer over the last few years, and with parameters for analysis that are available, the scheme looks on a solid footing going ahead.
Canara Robeco Bluechip Equity Fund is a largecap fund. As sum of Rs 10,000 invested in Canara Robeco Bluechip Equity Fund every month for the last three years would have translated into a corpus Rs 5.15 lakhs today, if you had gone by an SIP.
This means that Rs 3.6 lakhs invested through SIPs has now generated Rs 5.15 lakhs, which is not bad at all. The 3-year returns from the fund has been 16.82 per cent on an annualized basis, while the 5-year returns has been 16.21%.
Should you invest in the Canara Robeco Bluechip Equity Fund?
The portfolio of the fund comprises names like HDFC Bank, Infosys, ICICI Bank, Reliance Industries and TCS. If you study the portfolio of some other mutual fund schemes, you see that it is heavily skewed towards financials, which means, should the economy falter, there could be problem for banking stocks. At least the top 5 stocks of Canara Robeco Bluechip Equity Fund look a little more balanced with exposure to IT and a diversified play like Reliance Industries.
The fund presently has about 93.95% invested in equities, while the balance is invested in largecap shares. We suggest that since the Sensex has gone up to a record 53,000 points, investors should invest only through SIPs and not chase over exuberance of the markets. This means avoid investing lumpsum in equity mutual funds.
Mirae Asset Emerging Bluechip Fund
This fund again has been rated as 5-star by all the 3 big rating and analysis firms including Morningstar, CRISIL and Value Research. Again, the portfolio is strong and the returns have been solid. This unlike Canara Robeco Bluechip Equity Fund is a much larger fund with assets under management of more than Rs 18,000 crores.
The top-holdings are in larger banks, which means it is more skewed towards financials in its top 5 holdings, while Canara Robeco Bluechip Equity Fund was more diversified in that sense. The 3-year returns of the fund is 22.16%, which is higher or almost the highest among large cap equity mutual funds in the country. Even the 5-year returns on an an annualized basis at near 21% is solid.
Should you invest in Mirae Asset Emerging Bluechip Fund?
Again, if you ask us whether it is worth investing in the scheme, we would say "yes", but only through the SIP route. Markets have run up too fast over the last 1-year and not many are convinced that valuations are fair. An SIP for the Mirae Asset Emerging Bluechip Fund does not cost much and one can do with a sum of Rs 1,000 each month. Go for the scheme which has a good track record, but, only through the SIP route.
Investing in equity mutual funds is risky, so investors need to be cautious. Neither Greynium Information technologies nor the author would be responsible for any losses incurred due to a decision based on the above articles Please consult a professional advisor and remember the markets have run-up sharply.