Large Cap funds have been always investors’ top choices when it comes to stable, consistent returns over long investment tenure. The reason is large cap funds invest most of their asset in companies that are in the top hundred by market capitalization and mostly are bluechip. One such large cap fund which has been consistently performing well for ten years is Axis bluechip fund. This article will help you understand this fund and its constituents. The article will take you through its returns over the last ten years and a lot more details about which you need to know if you want to invest in this fund.
What is Axis Bluechip Fund?
Axis Mutual Fund offers this large cap mutual fund scheme which was launched more than 9 years and 6 months back in 2011. The fund invests in large-cap companies mostly and the remaining assets in debt instruments to balance out the risk profile.
The fund has a total of Rs. 32,322 crores of assets under its management as of 30th of June, 2022, which makes it a medium-sized fund in the largecap fund category.
If you are wondering what is a large cap fund then it is nothing but those mutual funds which invest 80% of their asset in large cap stocks which are the stocks of the top 100 companies by market capitalization.
Another thing to understand is bluechip stocks or bluechip fund refers to the mutual funds which invest in companies that have sound financial records, have been in the industry for years with proven track records, and are thus highly reliable to invest the funds. These stocks don’t get affected much by volatility in the stock market and thus provide consistent returns.
Mr. Shreyash Devalkar is the fund manager of Axis Bluechip Fund. His investment strategy for this fund is to provide returns consistently by investing in stocks that are less affected by market volatility. The benchmark index for this fund is S&P BSE 100 TRI and the minimum investment you have to make in this fund if you are opting for SIP is Rs. 500 while Rs. 5000 for lump sum investments.
Asset Allocation & Constituents of Axis Bluechip Fund
The fund as of the 30th of June, 2022, has 86.5% of equity and equity-related assets while the remaining 13.89% is invested in debt instruments.
Out of equity investments, if you observe asset allocation by market capitalization, then 86.07% of the asset is invested in large cap stocks, 0.43% in midcap stocks, and nothing in small cap stocks.
Then if you evaluate asset allocation by sector or industry, you will find the fund has invested around 34.81% in the financial sector which is at the top of asset allocation by sector. Then there is another 14.4% of the assets in the technology sector and 7.49% in services.
Finally, you need to check the individual stocks which make up the most of the fund. The top stocks in the Axis Bluechip fund are ICICI Bank Ltd. in which the fund has invested 9.36% of the total asset of the fund, followed by Bajaj Finance Ltd. with 7.91%, Infosys Ltd. with 7.54%, and then there is HDFC Ltd. with 7.08%.
Returns generated by Axis Bluechip Fund
The returns generated by this fund have been consistent for the past ten years as it has been providing controlled losses when the market corrects itself, the volatility is quite low owing to the nature of bluechip/ large cap stocks.
The average returns the fund has generated since inception is 14.65%. The five-year return is 13.6% while the category average is 11.04%. In the past few months, the fund has been providing lower and negative returns due to market turmoil and geopolitical issues however, for a long-term investor, this shouldn’t be a concern.
Why you should invest in Axis Bluechip Fund?
The reasons for investing in this can be the following –
- Consistent returns over almost ten years. Furthermore, the returns are higher than the category average as well.
- The expense ratio of the fund is 0.48% which is comparatively lower.
- There is no lock-in period which means if you invest in this fund, you can withdraw the money invested at any given point in time.
- The exit load is only 1% applicable on withdrawal of the investment.
Is the Axis Bluechip Fund have risk?
Though equity funds possess a high-risk factor and so does Axis Bluechip Fund, however, since the fund invests mostly in bluechip companies, the risk reduces to a great extent compared to other equity investments.
Thus, Axis Bluechip Fund can be one of the best options to invest your money if you are looking for consistent returns and you can stay invested for long.