Largecap mutual funds have proved their mettle in these difficult times. The toppers have given more than 60%, while most of the funds have given more than 45% in the last one year. How do you see this performance?

Largecap mutual funds are the ideal solution for investors who want to enter the markets as a novice. They are equally suitable for long-term investors who want to build long-term Investment Build relationships with equities and create wealth in the medium to long term. A typical large cap mutual fund as defined by SEBI invests at least 80% of its assets in top 100 companies by market capitalization. These companies are well researched and tracked extensively. It also means that many of these companies are liquid and relatively few. variable compared to their mid and small cap counterparts.

The performance of large cap funds has been in line with the broader market trends. Given that the breadth of the rally is quite wide, unlike the previous cycle, this range has performed well.

actively managed large cap fund Has secured the top position in the current rally. Do you think these large cap funds are going to make a comeback?

Large cap funds in essence give investors a fair pulse of the market. Today the top 100 companies account for about ~75% of the total market cap of all listed companies in India (Source: NSE). Hence it is safe to say that investors who want to take only equity exposure can stay in an ordinary large cap fund and benefit from the growth of these companies. Over the years, the quality profile of large cap companies has improved significantly.

With the advent of CSR, ESG and multiple regulations, these companies have become torch bearers for transparency, disclosure and clean business practices. While there are isolated instances of negativity, overall these companies have been successful in building and building investor confidence. The reward for them and the investors is that these companies are well priced and there is a constant demand for their equity shares from all types of investors, be it foreign investors, domestic institutions like us or retail.

Large cap funds used to be everyone’s favorite during tough times. However, investors are now betting on another category. Is this the new reality?

In short, your question is also your answer. Large cap funds are an all season equity investment solution. Largecaps, as I mentioned because of their market characteristics, tend to have less volatility than mid and small caps. Also, because of their business potential, these companies outperform smaller companies because of their market leadership and scale of operations. Companies that do not remain competitive are quickly replaced by agile and efficient businesses.

Furthermore, large cap companies are usually the leaders in large sectors. They represent different sectors of the economy, including the service sector, manufacturing and exports.

Among the plethora of funds that investors can choose from today, most strategies that are market cap agnostic generally favor largecaps, as they score well on fundamentals and are also liquid enough to trade in large volumes. Huh. .

The investor mindset is largely the same. Hence large cap funds can be a staple in a well managed investor’s portfolio.

Many investors believe that most flexi cap funds also invest in large stocks. This is the reason why they justify investing in flexi cap funds instead of large cap funds, even if they are market conscious. What do you call these investors?

What percentage of his equity exposure should be in large/mid/small if the investor is clear on his equity asset allocation call based on individual risk. In that case, choosing a bouquet of funds in each category is recommended.

India is a stock picker market. With the pace of disruption, we are exploring opportunities across the market cap spectrum for companies with strong growth characteristics, well-managed balance sheets and high quality niche businesses. The primary market and the unlisted space have also become big hunting grounds as investors look for alpha.

Flexicap and multicap funds bridge this gap for investors looking for a single fund to meet their investment needs. I run Axis Bluechip Fund as well as Axis Flexicap Fund and Axis Midcap Fund. All three funds have unique investment mandates and as such their portfolios are positioned according to the best opportunity stipulated within these investment mandates.

For investors choosing a specific fund type they should evaluate what their portfolio needs. large cap With development provide relative security. Mid and small caps are high growth high reward but also come with their share of risk.

The market is at an all time high. Should investors be too cautious? What should be their strategy?

The market at an all-time high is a reality. However, the value of Sensex or Nifty is an indicator of the performance of your investment and as such should not be a barometer for positioning or capitalizing investments. Ultimately, you participate in the earnings of a company or portfolio when one buys equity either directly or through a mutual fund.

New investors entering the equity markets should not be swayed by the recent bullish but should focus on the long-term prospects of equity investments. A systematic investment plan is an ideal solution for investors. We are careful in identifying markers and have used high valuations to rotate our portfolio. Investors can expect volatility in the near term and should use sharp market declines to systematically add to the current allocation.

The active versus passive debate is still not settled. What’s your point of view? Anecdotal evidence suggests that investors are warming to index funds.

The idle story has been doing very well in India over the past decade or so. While the absolute increase in AUM is driven by meaningful allocation of equities by pension funds and government agencies through ETFs, there has been a huge awareness campaign that has resulted in investors appreciating the benefits of low-cost investments.

This is widely accepted by the West as markets there have reached a stage of market efficiency where an active fund manager has limited headroom to meaningfully outperform the benchmark. In India, given the vibrancy of the markets and the increasing market awareness, there is also scope for proactive management. The investor portfolio should make an allocation across both types of products to get the best out of their equity investments today.