Mutual Funds

Mirae Asset Emerging Bluechip: Quality mid-caps spice up returns

Nalinakanthi V | Updated on January 18, 2018 Published on July 31, 2016

bl31_Mirae Asset

This fund suits investors with higher risk appetite and longer investment horizon

Looking for a mid and small-cap focussed fund to spice up your returns? Then, Mirae Asset Emerging Bluechip Fund that invests in quality mid-cap stocks fits the bill. The fund has delivered benchmark beating returns across timeframes – one, three and five years. For instance, the fund has delivered almost 41 per cent annualised gains in the last three years, higher than the 27 per cent rise in the Nifty Free Float Midcap 100 Index.

Thanks to its sustained outperformance, the fund tops the list of mid-cap schemes.

Small and mid-cap indices have been on a roll over the last year or so. While funds investing in these stocks have delivered mouth-watering returns, they are more vulnerable to market volatility. Hence these funds may only suit investors with a longer investment horizon and higher risk appetite. If you are a high-risk investor and have a five-year timeframe, you can park a portion of your surplus in Mirae Asset Emerging Bluechip Fund.

Mirae Asset Emerging Bluechip Fund also scores high on consistency. In the last five years, the fund’s annual returns have been better than the benchmark almost 99 per cent of the time.

The fund also has a good track record of containing downside during turbulent times. Sample this — between November 2010 and December 2011, the Nifty Free Float Midcap 100 Index shed over 37 per cent. But the fund managed to contain the fall in its NAV at less than 21 per cent. Similarly, during the January-August 2013 period, the fund managed to arrest the fall at less than 17 per cent; this is lower than the 23 per cent fall in its benchmark. Taking refuge in less volatile themes such as pharma, IT and FMCG helped the fund’s performance.

The fund has been successful in making the most of rallies, too. For instance, during September 2013-February 2015, the scheme’s NAV jumped by over 160 per cent, higher than the 107 per cent rise in Nifty Free Float Midcap 100 Index. The fund’s ability to identify multi-bagger stocks such as Vinati Organics, Prism Cement, Bharat Forge, Eicher Motors, HSIL, Titagarh Wagons, Bajaj Finance, Solar Industries, Dewan Housing Corporation, Gateway Distriparks and JK Cements has provided a big leg-up to its performance.

As of June 30, the fund held 65 stocks in its portfolio; mid and small-cap stocks account for over two-thirds of the scheme’s assets. In the past year, the scheme has increased exposure to auto ancillaries stocks and has pruned its holding in banks and IT companies.

Published on July 31, 2016

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