Bluechip mutual fund SIPs are best suited for investors who are looking for safety and security from the investment. Here, the portfolio of a large-cap mutual fund has been discussed.
Large-cap / bluechip fund investment rationale
The Large Cap mutual funds are identified by their investments in the stocks, depending on the market capitalization. The large-cap funds will mostly select the bluechip stocks or top 100 companies listed in the equity markets. The sector of the company will not matter much, rather the previous years' return will be a concern for the mutual fund house. The Bluechip stocks will have a market capitalization of $200 or more. These companies are well established in the stock markets for years, with a good reputation for security, growth, and returns. So, investors, tend to incline towards the large-cap mutual fund SIP, for better security and lucrative returns.
However, investors are expected to hold positions in large-cap mutual funds for long terms for good returns. Additionally, apart from bluechip stocks, the large-cap mutual funds will also invest in some mid-cap and small-cap stocks.
Aditya Birla Sun Life Frontline Equity Fund - Regular Plan-Growth
Aditya Birla Sun Life Frontline Equity Fund - Regular Plan is a mutual fund SIP investment that has a NAV of Rs. 346.76, and the size - Assets Under Management (AUM) of this fund is Rs. 21004 crore. AUM is the total market value of the assets which a mutual fund will manage at a point in time. On the other hand, the Expense Ratio (ER) of this fund is 1.80%, while the category average is 2.22%. The ER is marginally lower than the category average, which is profitable for the investors. The Expense Ratio is the percentage, which the fund house will use from the retail investors' investments, for fund management purposes.
This mutual fund SIP has been best rated with 3 Star by reputed rating agency Morningstar.
Absolute and annualized returns
As it is a large-cap fund, its absolute returns from SIPs have been reported higher in the long term. In the last 1-year SIP return stood at 8.21%, in the last 2 years it has fetched 33.81% returns, in the last 3 years it has given 40.53% returns, in the last 5 years, it has fetched 49.68% returns, and in the past 10 years, it has given 114.4% returns. Annualized returns from Aditya Birla Sun Life Frontline Equity Fund - Regular Plan's SIP were 30.83% in the past 2 years, and 23.4% in the past 3 years.
Aditya Birla Sun Life Frontline Equity Fund - Regular Plan's absolute mutual fund returns are highest in 5 years terms. In the last 1 year return stood at 21.85%, in the last 2 years it has fetched 121.03% returns, in the last 3 years it has given 53.74% returns, in the last 5 years it has given 78.63% returns, and in the past 10 years it has given 314.64% returns. In the past 10 years, the Aditya Birla Sun Life Frontline Equity Fund - Regular Plan's annualized returns stood at 48.59%, outperforming the category average of 44.84%.
(Data till April 4, 2022)
Aditya Birla Sun Life Frontline Equity Fund - Regular Plan's total equity holding is 96.75%, and the rest of the 3.25% is invested in other sectors. Among a total of 69 stocks, the Fund's Large Cap Investments are 76.77%, Mid Cap Investments are 8.6, Small Cap Investments is 1.07%, and 10.31% investments are allocated to other funds.
The top 10 equity holdings of the fund are ICICI Bank Ltd., Infosys Ltd. Computers, HDFC Bank Ltd., Reliance Industries Ltd., Larsen & Toubro Ltd., Bharti Airtel Ltd., Axis Bank Ltd., State Bank Of India, HCL Technologies Limited, Housing Development Finance Corporation Ltd.
Other funds under this category are, IDBI India Top 100 Equity Fund - Growth, Invesco India Large-cap Fund - Growth, ICICI Prudential Bluechip Fund-Growth, etc.
Investing in equities/mutual funds/SIPs/debts poses a risk of financial losses. Investors must therefore exercise due caution. Greynium Information Technologies, and the author are not liable for any losses caused as a result of decisions based on the article.