Let us find the best large-cap mutual fund to invest in in 2022 and review the performance of our choice of best large-cap fund of 2021.
So let’s begin.
2021 was an excellent year for the overall equity market, especially large-cap. So large-cap funds have done much better.
Strict SEBI guidelines for the classification of large-cap stocks did dampen returns. However, it also meant that investors get what they have invested in. So, a large-cap fund investing in smaller companies for better returns has reduced considerably.
Moreover, Sensex and the Nifty did well in 2021. So, lump-sum or SIP investments in a better large-cap fund in 2021 ensured outperformance.
We will use the process to come to the best large-cap fund for 2021 is – from the 4-star and 5-star rated large-cap fund by ValueResearchOnline, we will compare the past year’s performance along with the expense ratio to get the best large-cap fund.
Based on the expense ratio, asset under management or AUM and past performances, the best large-cap funds for 2022 has to be:
The best large-cap fund to invest in 2022 has to be Canara Robeco Bluechip Equity.
The fund has performed in line with Sensex and has generated 30% returns. With a lower expense ratio, it can indeed outperform in 2022 as well.
As expected, CRISIL also lists the Canara Robeco Bluechip Equity Fund as the best large-cap fund.
Axis Bluechip Fund has been a consistent performer. It was the best large-cap fund in 2019, 2020 and 2021.
CRISIL has removed it from the top fund right now, but I think it can still outperform because of its lower expense ratio.
Sensex benchmark funds like Nippon Ind Index Sensex and Tata Index Sensex fund have lower expense ratios but minimal assets under management. So if you have to choose a Sensex benchmarked fund, it has to be HDFC Index Sensex fund.
I share the series of best funds because we evaluate how we have done in the past. It means either we do well investing or learn to improve our fund selection process.
The best large-cap funds of 2021 were Axis Bluechip Fund and Canara Robeco Bluechip Equity Fund. They made returns in access of 30%, which is excellent considering the stability of a large-cap fund.
Do not switch funds every year and pay the entry and exit load or long term capital gains tax.
Suppose you have not selected a better performing fund earlier or want to move to a new fund for any other reason (move to regular to direct funds). Then, don’t exit the investment in the old fund. Instead, stop the SIP and let the invested amount remain and grow over time in those funds. Then, create a new SIP in the new fund.
As always, this isn’t an endorsement of any fund. Instead, the emphasis is on the process. The funds may be doing well now, but use the same process and find the best fund when you want to invest. Use ValueResearchOnline and CRISIL as and when you want to invest in 2022.
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