Here’s a monthly update on our favored large-cap mutual funds to invest in 2019. The good news is that there is no variation in the recommendations. Many careful and new investors typically search for equity mutual fund schemes that will help them to create wealth without too much risk and volatility. If you are such an investor, you should consider investing in large-cap mutual fund schemes. If you invest with an investment horizon of five to seven years, these schemes may help you to build wealth over a long period without too much volatility.
Large-cap mutual fund schemes, as the name suggests, invest in stocks of very extensive companies or stocks with the largest market capitalization. According to Sebi’s new categorization norms, large-cap mutual fund schemes have a mandate to invest at least 80 percent of the corpus in top 100 companies by market capitalization.
These general companies may be leaders in their respective field and they may be relatively stable than smaller companies during a volatile phase in the market. That earns them ideal for investors who want to create wealth without taking an extra risk or exposing their corpus to a lot of volatility.
Many mutual fund managers and advisors have been recommending large-cap schemes for a while now. They believe that they are romantic to tide over uncertain times. No wonder, since large-cap stocks are better placed than mid cap and small cap stocks to fare relatively better in times of a market correction.
As you can see, these factors present large-cap schemes ideal for conservative equity mutual fund investors. If you have a low-risk appetite and want to invest in stocks to conceive wealth over a long period, you have two options: investing in aggressive hybrid schemes (erstwhile balanced schemes or equity-oriented hybrid schemes) or large-cap schemes.
Note, since these schemes are relatively concise volatile, they also offer modest returns. So, it is important to have realistic return expectations while investing in large-cap schemes. Also, you should remember that the ability of this category to generate considerable returns over their benchmarks is seriously contested after the re-categorization. In fact, most actively-managed large-cap schemes failed to beat their benchmark last year. Passively-managed schemes – index schemes and ETFs – fared better than them in the last year.
Here are our esteemed large-cap schemes. You may invest in these schemes with a minimum investment horizon of five to seven years to achieve your long-term financial goals. Look out for our monthly updates – so that you know whether your schemes are performing up to the mark. We usually come up with our updates in the first week of every month.