Mutual funds are gaining popularity among Indian investors, especially those who want a safer alternative to direct stock market investments. Blue chip mutual funds, in particular, are attracting a lot of attention because of their reliable returns and lower risk. These funds invest in well-established large-cap companies, making them a stable investment option for the long term. Let’s dive deeper into blue chip mutual funds and explore the top-performing ones that have doubled or more in value over five years.
What Are Blue Chip Mutual Funds?
Blue chip mutual funds are essentially large-cap mutual funds that invest in established companies with a strong market presence. Though there isn’t an official “blue chip” category, some funds are labeled as such due to their investment in large, stable companies. These companies are considered low-risk due to their size and financial strength, which makes their shares less volatile. Popular blue chip mutual funds include Canara Robeco Bluechip Equity Fund, ICICI Prudential Bluechip Fund, Kotak Bluechip Fund, and Franklin India Bluechip Fund.
Why Invest in Blue Chip Mutual Funds?
The main reason investors prefer blue chip funds is the lower risk involved compared to small or mid-cap funds. Large-cap companies have a proven track record, which offers more stability in their performance. Blue chip mutual funds are ideal for investors looking for long-term growth without the daily volatility that often accompanies stock market investments. Experts recommend holding these funds for at least five years to maximize returns.
Top Blue Chip Mutual Funds: How Have They Performed?
Several blue chip mutual funds have shown impressive growth over the past five years. With annual returns exceeding 20%, these funds have more than doubled investors’ money. Let’s look at some of the top performers:
1. Nippon India Large Cap Fund
- Annual Return: 22.16%
- 5-Year Investment Growth: If you had invested Rs. 1 lakh five years ago, your investment would be worth Rs. 2.72 lakh today.
- Nippon India Large Cap Fund has shown consistent performance, providing strong returns even in uncertain market conditions.
2. Invesco India Largecap Fund
- Annual Return: 21.86%
- 5-Year Investment Growth: An investment of Rs. 1 lakh five years ago would now be worth Rs. 2.69 lakh.
- This fund has made significant profits for its investors, maintaining a stable trajectory over the years.
3. ICICI Prudential Bluechip Fund
- Annual Return: 21.42%
- 5-Year Investment Growth: A Rs. 1 lakh investment has grown to Rs. 2.64 lakh in five years.
- ICICI Prudential Bluechip Fund is a popular choice for investors looking for long-term growth with moderate risk.
4. Kotak Bluechip Fund
- Annual Return: 21.20%
- 5-Year Investment Growth: An initial investment of Rs. 1 lakh would now be worth around Rs. 2.62 lakh.
- Kotak Bluechip Fund has delivered consistent returns and is a solid option for those looking to grow their wealth steadily.
5. Baroda BNP Paribas Large Cap Fund
- Annual Return: 20.92%
- 5-Year Investment Growth: If you had invested Rs. 1 lakh five years ago, your investment would now be valued at Rs. 2.58 lakh.
- Baroda BNP Paribas Large Cap Fund has proven its worth with impressive returns, making it a strong contender in the large-cap category.
Why Choose Blue Chip Funds Over Other Mutual Funds?
For investors who are risk-averse but still want exposure to the equity market, blue chip mutual funds are a safer option. The companies that make up these funds are market leaders with a solid track record. While small and mid-cap funds may offer higher potential returns, they come with more risk. Blue chip mutual funds strike a balance between steady growth and lower risk, making them ideal for conservative investors.
Long-Term Investment Strategy
Experts suggest that if you’re investing in blue chip mutual funds, you should stay invested for at least five years to maximize your returns. These funds provide the best results when held over a longer period, as large-cap companies may take time to show significant growth. Investors can expect stable and growing returns as the companies in these funds continue to perform well.
Before investing, always consult a certified financial advisor, as market conditions can change rapidly. But if you are looking for a reliable, long-term investment option, blue chip mutual funds are a solid choice to grow your wealth over time.
