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Mirae Asset Emerging Bluechip Fund: Fund Review

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Mirae Asset Emerging Bluechip Fund lives up to its ‘bluechip’ tag. It offers its investors an opportunity to invest in today’s large, mid and small-sized companies which have the potential to perform well in the coming years. Ever since it entered the 5-star rating it held on to it and performed exceptionally well since its inception. The fund manager, Neelesh Surana, is consistently ranked among the best fund managers. This fund, under his supervision, has outperformed the benchmark index and peers ever since inception. He stuck to the larger mid-cap companies and played well within the sector by concentrating on quality.

 

 

Performance

Mirae Asset Emerging Bluechip Fund is the top performing fund in the large & mid-cap space. The fund has consistently outperformed its peers and the benchmark index right from the inception. The fund has performed well both in the bull and bear phases of the market. This success can be attributed to the investment strategy of the fund manager. The fund has delivered an annualized return of 20.96% since inception in July 2010 as against 11.06% by Nifty Large Midcap Index, its benchmark.

 

 

The fund has beaten its category by 4-9 percentage points and its benchmark by 7-12 percentage points in the 1, 3 and 5-year returns. While its peers have struggled to deliver consistent performance during both bull and bear phases, this fund has performed well in all market phases.

 

Fund1 Year Return (%)3 Year Return (%)5 Year Return (%)
Mirae Asset Emerging Bluechip Fund-5.17%18.47%27.07%
Canara Robeco Emerging Equities Fund-8.88%14.92%26.68%
Principal Emerging Bluechip Fund-12.61%15.09%22.97%
Sundaram Large and Midcap Fund-4.22%13.83%18.04%
SBI Large & Midcap Fund-6.30%11.90%17.39%

 

A SIP investment of Rs 5,000 a month in the fund started 5 years ago is worth Rs 4.60 lakhs now. A profit of Rs 1.6 lakhs in just 5 years. Even if one chose to redeem their investment then they would be liable to pay tax only on Rs 0.6 lakhs as gains up to Rs 1 lakh is exempt from taxes.

 

Fund Information

Mirae Asset Emerging Bluechip Fund, a five-star rated fund, is the top fund in the large & mid-cap category. The fund prefers companies with operating profits of around Rs 100 crore. It avoids placing bets on small companies. The key to the funds’ consistency is its ability to buy at a reasonable price by being quality conscious.

The fund selects businesses that have a sustainable competitive advantage, high ROI, free cash flows and strong earnings growth. The fund also includes the quality of the management as the main criteria for selecting stocks. It only picks up companies which have a good corporate governance track record. Being extremely quality conscious doesn’t affect the price at which they buy stocks. The manager makes sure they buy the stocks at a reasonable price and he seeks for the price-value gap.

The fund believes in diversification with 60 stocks in the portfolio. The top five holding sectors constitute 53.47% of the portfolio. These include Banks (21.84%), Consumer Non-Durables (8.57%), Software (7.78%), Finance (7.78%), and Pharma (7.50%).

Recommendation

Mirae Asset Emerging Bluechip Fund is ideal for long-term goals. Investors whose risk-taking ability is high can look at investing in this fund. The fund accepts only SIP investments up to Rs25,000 a month and only on the 10th of every month. The fund doesn’t allow lumpsum and STP investments. This fund has higher ups and downs (volatility) than other equity funds but can yield much better returns. Invest in this fund for an investment horizon of at least 5 years to give the best results. Do not look at the returns for this fund in short-term. The short-term returns can be manipulative.

 

Fund NameMirae Asset Emerging Bluechip Fund
Launch DateJuly 9th, 2010
AUMRs 6,340 Cr
Return (Returns greater than 1 year are annualized)Since Launch: 20.96%
1 Year: -5.17%
3 Year: 18.47%
5 Year: 27.07%
Expense Ratio2.26%
Fund Category RiskHigh
Investment PlanGrowth
Minimum Investment Horizon5+ years
Minimum InvestmentRs 5,000
Minimum Additional InvestmentRs 1,000
Exit Load1% if withdrawn within 1 year
Fund ManagerNeelesh Surana
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