Large-cap mutual funds, which focus on investing in the top 100 companies by market capitalisation, are suited for those new to equity investing or investors with a moderate appetite for risk. These funds allocate their portfolios to well-established market leaders that boast stable business models, diversified income sources, and sound financial health. As per the latest classification by AMFI, such companies generally have market capitalisations exceeding ₹1 lakh crore.
Large-cap funds tend to exhibit lower levels of volatility compared to mid-cap and small-cap funds. This makes them a more comfortable choice for risk-averse investors. However, because these companies are already in a mature phase of growth, they may not offer the high returns that mid and smaller, fast-growing companies might deliver during strong economic upswings.
Despite this, large-cap funds play a crucial role in anchoring an investor’s portfolio by offering long-term stability and reliable, albeit steady, growth. They are often recommended as a starting point for first-time investors venturing into equity markets.
The bl.portfolio Star Track Mutual Fund Ratings is designed to help investors pinpoint the most consistently performing funds within each category. It assesses mutual funds by analysing their long-term returns and risk profile. Funds are awarded star ratings ranging from 1 to 5, with a 5-star rating reflecting the highest level of consistent performance. Listed below are the large-cap funds that have secured four- and five-star ratings under this system.