Blue-chip funds are the funds which invest in blue-chip stocks. These funds majorly invest in the companies and businesses that have established a track record. These are generally the funds which have experts to manage the funds and excellent leadership which builds up the company rapport. These companies are famous for paying out dividends to the shareholders.
All the AMCs like SBI MF, ICICI Mutual Fund, Mirae Mutual Fund, Axis MF, DSP Blackrock HDFC Mutual Fund etc. provide Blue-chip funds for investments. Following are the 5 best blue-chip funds available in market
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Mirae Asset Emerging Bluechip Fund
Parameters:
Crisil Rank: 2
Value Research rating: 5
AUM: 5780 Cr
1 year: -5%
3 year: 16%
5 year: 28%
Investment strategy
The Mirae Asset emerging Blue-chip funds aims at capital generation and appreciation over time through an aptly diversified portfolio. The fund majorly invests in Indian equities and equity securities targeting large and mid-cap companies.
Reason to invest
The numbers are quite evident in the fund’s performance over the years. This fund is known to outperform other funds in its category and has maintained a value research rating of 5 since inception.
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SBI Bluechip Fund
Parameters:
Crisil Rank: 4
Value Research rating: 5
AUM: 19096 Cr
1-year return: -4%
3-year return: 9%
5-year return: 16%
Investment Strategy
Actively managing a diversified portfolio of large-cap equity securities in order to achieve capital growth.
Reason to invest
SBI Blue-chip fund has also maintained a Value Research rating of 5 for a long time. It has been known to outperform its peer funds during the crisis times.
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ICICI Prudential Blue-Chip fund
Parameters:
Crisil Rank: 2
Value Research rating: 4
AUM: 18870 Cr
1 year: -1%
3 year: 11%
5 year: 15%
Investment strategy
Capital generation and distribution are two main USPs of ICICI Pru Blue-chip fund. The portfolio is diversified across large-cap funds majorly in equity and equity-related securities.
Reason to invest
The fund has given 15% annualized returns in the last 5 years and 19% in the last 10 years. With these numbers and a consistent rating of 5 with Value research, ICICI Pru is a good Blue-chip fund to invest in.
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Axis Blue-chip fund
Parameters:
Crisil Rank: 1
Value Research rating: 5
AUM: 2927 Cr
1 year: 7%
3 year: 12%
5 year: 15%
Investment strategy
The fund aims at capital generation and appreciation over time through an aptly diversified portfolio. The fund majorly invests in Indian equities and equity securities targeting large and mid-cap companies.
Reason to invest
This fund has managed an unmatched 12% returns since inception with Value Research rating 5. Outperforming its peers, the Axis Blue-chip fund is a promising one in the category.
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Kotak Blue-chip fund
Parameters:
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Crisil Rank: 3
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Value Research rating: 3
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AUM: 1280 Cr
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1 year: -2%
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3 year: 8%
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5 year: 14%
Investment strategy
The main focus of this fund is to generate capital through investing in large-cap funds.
Blue-chip funds are considered to be the superior most funds having high value as compared to other stocks. The term blue-chip is borrowed from the game of poker where the chip with the highest value is represented with the color blue. Blue chip funds are believed to yield high returns when the markets are favorable and are known to survive the adverse market conditions gracefully.
Reason to invest
Excellent 5-year returns at 14% and Value research and crisis rating 3, Kotak blue-chip fund are amongst the topmost Blue-chip funds available in the market. It has matched and outrun its competitors in the same category over 5-year and 10-year returns. Why do you need blue-chip funds?
If you wish to bring stability in your portfolio, blue-chip funds are the one to go for. These funds provide stability and growth to your profile. These funds are capable of delivering good returns over the due course of time. They withstand and survive the market volatility and are led by people who are experts and professional. Here are some key reasons why you should have bluechip funds in your portfolio;
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Financial strength
Companies which own blue-chip funds are amongst the financial leaders in the market. They are strong and less volatile. The share price they offer is well-cushioned against the market volatility and is known to maintain a stable market positioning. Mutual funds which invest in these types of companies are rewarded with high growth and returns.
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Diversified risk
Blue chip companies are spread across various sectors in the market. Their risks are spread across diversified businesses. Also, these funds are choicest for people who do not want to get exposed to a lot of risks. Due to the large size and multiple businesses spread across various markets and geographies, the risk factor reduces considerably of these funds when compared to small or mid-cap funds.
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Goodwill with public
Blue chip companies are usually the ones which you come across every day in routine. They have established goodwill with the general public. Due to this, the people (investors) feel associated with the company and prefer them over other lesser famous ones. Strong goodwill and public presence result in high brand recognition and diversified businesses.
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Consistent payout
One of the biggest advantages of investing in blue-chip companies is that they are regular with payouts to their investors and provided with consistent dividends. They are an excellent source of income. If you are looking for regular dividends which can be used as a regular source of income, go for blue-chip mutual funds. try XXXXXX
Parameters for selection of blue-chip funds
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Investment strategy- MF who strategize on investing in Blue-chip funds
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Past performance- tracking the last 5-year, 3-year, and 1-year performance
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Loss buffer- MF which have recovered the losses borne in last 1 year.
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Value Research Rating- VR rating tells a lot about the MF performance
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Crisil Rating- Crisil rating also gives insights into the performance of the mutual fund
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AUM- MF having minimum Rs. 100 Crores as Assets Under Management
Who should go for blue-chip funds?
Blue-chip funds, although are the choice of every investor due to their high returns and regular payouts, these funds are best suited for people who are risk-averse or have a little appetite for risk. These are one of the most stable funds and also their prices do not fall drastically while the markets are adverse. Due to their lower risk profile, he returns are a little on the lower side as compared to mid and small cap funds.
