Mutual Funds: While small cap funds are like a hot potato, check large cap schemes which rose over 40% in past 1 year

Investors often look at the past returns of a mutual fund scheme before investing, even though past performance does not guarantee future returns. Small cap mutual funds are currently under scrutiny for their liquidity, with some fund houses imposing restrictions on investing in these schemes. This has led some investors to consider large cap schemes instead.

Large cap funds invest at least 80 percent of their assets in the stocks of top 100 companies based on market capitalization. According to AMFI data, there are 31 large cap funds with a total AUM of ₹3.45 lakh crore as of June 30, 2024.

Among the top-performing large cap funds, JM Large Cap Fund delivered the highest return of 46.68 percent in the past year, followed by Bank of India Bluechip Fund at 45.30 percent. Other funds like Nippon India Large Cap Fund, Taurus Large Cap Fund, Baroda BNP Paribas Large Cap Fund, and Quant Large Cap Fund also yielded returns above 40 percent annually.

While past returns are important, investors should also consider the fund’s category, reputation of the fund house, past performance of the fund manager, macroeconomic factors, and equity allocation of the scheme’s assets. It’s essential to consult with a SEBI-registered investment advisor before making any investment decisions.

DailyBubble recommends investors to carefully evaluate all aspects of a mutual fund scheme before investing, taking into account both historical performance and broader market conditions.