3 Best Largecap Mutual Funds Of The Last 1-Year, Should You Invest In Their SIPs?

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oi-Sunil Fernandes

| Published: Thursday, July 22, 2021, 10:39 [IST]

Markets have been on a solid footing over the last 1-year and largecap equity mutual funds have followed the Sensex in terms of returns. Solid robust returns have become the norm for some of these funds, as the Sensex continues to scale new highs. Recently, it crossed another milestone of 53,000 points and largecap equity mutual funds returns over the last 1-year have been phenomenal.

3 Largecap funds that have done well over the last 1-year

Now, when we say they are the best largecap equity mutual funds, what we mean is that they have been the best in terms of returns. Over the last 1-year. We are in no way saying that they are the best to invest in, based on other parameters.

Best 1-year returns from largecap equity mutual funds

1-year returns
Franklin India Bluechip Fund 58.09%
Nippon India Largecap Fund 50.70%
IDBI India Top 100 Equity Fund 48.83%

If a year back, you would have told investors that one would get 58% returns in 1-year, they would have dismissed you. But, the fact is that most largecap equity mutual funds have given those kind of returns and small cap equity mutual funds have given an even higher returns of 70% and above.

Should you invest in the SIPs of these mutual funds?

For starters let us inform readers that if you look at largecap equity mutual funds, their top 5 holdings which can account for 30 to 40% of the portfolio is almost the same. You almost always find the same set of stocks namely SBI, ICICI Bank, Reliance, Infosys and HDFC Bank. Therefore, there could be a marginal variation in performance. A mutual fund that has performed well today, may not necessarily perform well tomorrow.

What we would suggest is to take a look at the ratings accorded to some of these mutual fund schemes from agencies like Morningstar and CRISIL before investing. Some of these adopt very stringent measures for rating.

Another important thing to remember that the ideal way to invest now would be through the Systematic Investment Plans only. It would be very unwise to just go ahead and put lumpsum amount in some of the funds, as the markets are dangerously high. Also, if you are expecting phenomenal returns when the Sensex is as high as 53,000 points, your expectations must be a bit too much. Therefore, it is advisable to lower expectations as well, given where the markets currently are.

As far as Franklin India Bluechip Fund is concerned it has a 2-star rating from Value Research and one can start an SIP with a sum of Rs 5,000. Nippon India Largecap Fund too has a 2-star rating, and so does IDBI India Top 100 Equity Fund from Value Research. We have to caution readers as well, that past performance is no indication of future performance. However, since we are suggesting SIPs, the risks are less, should there be a sudden crash in the markets.

Disclaimer

Investing in equity mutual funds is risky. Investors should invest based on their risk ability. The above article is for informational purposes only and should not be construed as investment advise. Neither the author, nor Greynium Information Technologies would be responsible for losses incurred based on a decision taken after reading the article.

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Story first published: Thursday, July 22, 2021, 10:39 [IST]