The mutual fund industry in India has grown from ₹10.06 trillion as of July 31, 2014, to ₹64.97 trillion as of July 31, 2024. This remarkable jump of 6X showcases the incredible impact of mutual funds as an investment proposition. But of all, a few perform exceptionally well due to the management and investment strategies adopted by the fund managers.
One such outperformer in the large-cap fund category is the SBI Blue Chip Mutual Fund. The fund has offered 16% returns in the last 3 years, making it a suitable option for those who are looking for wealth creation. Known for its strategic investing technique, the fund is intended to capitalize on the capabilities of leading firms while keeping a balanced risk profile.
So, let us explore the investment strategies adopted by the SBI Bluechip mutual fund that have made it outperform its competitors.
Highlights of SBI Bluechip Fund
SBI Bluechip fund is one of the best-performing funds in the market with the highlights as discussed below:
- Launch Date: The SBI Bluechip Fund was launched on February 14, 2006, to offer opportunities for long-term capital growth by investments in large-cap stocks.
- Fund Type: It is an open-ended large-cap equity scheme that allows for continuous investment and redemption by investors.
- Investment Objective: The fund aims to provide long-term capital appreciation by investing in stocks of large-cap companies, aligning with its strategy to target stable and well-established businesses.
- Performance: With an NAV of ₹90.6245 as of August 23, 2024, the fund has demonstrated competitive returns, reporting a 25.57% return over the past year, 16.8% over three years, and 16.66% over five years.
- Asset Allocation: Primarily focused on large-cap stocks, the fund allocates a minor portion of its assets to mid-cap stocks and other equity-related securities to diversify and enhance returns.
- Assets Under Management (AUM): As of June 30, 2024, the fund manages assets worth ₹49,175.69 Crores.
- Minimum Investment: The fund requires a minimum initial lump sum investment of ₹5,000, making it accessible to a broad spectrum of investors.
Investment Strategies Used by SBI Bluechip Fund
Bluechip mutual funds invest in stocks of well-established companies with a proven track record of offering consistent dividend payouts and financial performance. The aim is to ensure profitability over the long run. Here are the key strategies that have contributed to its success against its peers:
1. Focus on Large-cap Stocks
SBI Bluechip Fund invests 80% of its total value in large-cap stocks. These are the stocks of well-known companies with good brand equity and are the market leaders in their respective segments. This makes them the best performers with stable existence and paid consistent dividends.
2. Blend of Growth and Value Investing
The fund employs growth and value investing strategies. It balances the goal of high-growth stocks with stability and the undervalued companies with the potential for appreciation. This blend allows for capturing upside while mitigating risks during market downturns.
3. Top-Down and Bottom-Up Approaches
The fund employs a combination of top-down economic and sector analysis. This strategy positions it to leverage macroeconomic trends effectively. Additionally, a bottom-up approach to stock selection ensures that each investment is based on solid fundamentals and promising business models.
4. Sector Diversification
The fund is not confined to specific sectors but spreads investments across various industries. This diversification helps mitigate risks and explore growth opportunities in different sectors, enhancing the potential for superior returns.
5. Proactive Risk Management
SBI fund uses sophisticated risk assessment tools to monitor and manage market exposure. This proactive risk management protects the portfolio against extreme fluctuations and helps sustain long-term investment objectives.
6. Active Management
Active portfolio management allows the fund to adapt swiftly to changing market conditions. The fund managers continuously assess and realign the portfolio to optimize performance.
Conclusion
Mutual funds are dynamic, allowing investors to gain better returns. Strategic management, like the SBI Bluechip Fund, offers a well-managed portfolio that aims to achieve high performance. This makes it attractive for those seeking efficient and effective investment growth. So, if you want to invest in mutual funds, check its highlights and investment strategies before finalizing.
