Fund of Fortnight

This is our mutual fund recommendation. Every fortnight, we recommend one open-ended equity diversified fund that has the best potential of returns for the next one year considering its constituents remain the same. [EasyDNNnews:PaidContentStart]

Reason for recommendation 

The equity market is currently on slippery ground due to the confluence of various factors. This has also put a question mark on the continuation of the current momentum in the equity market. Therefore, it makes sense to invest in Large-Capdedicated funds as their move in the last one year has been measured and limited. In such a scenario, Canara Robeco Bluechip Equity Fund remains one of the best funds from the large-cap category. What favours the fund is its beta of 0.89 which is lower than that of the market i.e. 1, and also is less than the category average of 1.18. 

In a volatile market it helps to contain loss in case the market falls further. The fund has one of the best Sortino ratios of 1.93 as against the category average of 1.8 and S & P BSE 100 TRI which is 1.76. If we look at the fund’s one-year rolling returns, the median return has been at 14.6 per cent against the category average of 12.5 per cent. Even in a three-year period, the median rolling return of the fund has been almost 2.5 per cent higher than the category average. 

In terms of its portfolio, the fund is quite bullish on financial, technology and energy sectors. It has the highest weightage of 27.5 per cent in the financial sector. Even in the financial sector it has allocated more towards banking stocks. HDFC Bank and ICICI Bank remain the top two holdings of the fund. Investing in a staggered manner would be more beneficial as investors won’t have to worry about catching the bottom of the downward move. Therefore, in our view this fund will make sense to investors with moderate to high risk and having an investment horizon of more than one year. 

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