HDFC Top 100 Fund, which recently completed 27 years of operations, has created humungous wealth for its investors since its inception. Data shared by HDFC Asset Management Company showed that the scheme has delivered an annualised return of 19 per cent during the period.
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This means an SIP of Rs 10,000 invested systematically on the first business of every month (total investment Rs 32.40 lakh) in the mutual fund would have turned to Rs 6.88 crore by September 29, 2023.
The mutual fund scheme follows a bottom-up approach to stock picking blended with top-down sector and macro trends, according to HDFC Asset Management Company.
The fund house further added that the focus is on the quality of the business model, management and financial metrics while selecting stock for HDFC Top 100 Fund. As per the mandate, over 80 per cent of the portfolio remains invested in well-established large cap companies.
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“The core of the portfolio construction is from a medium to long-term perspective. The strategy will be in line with our philosophy of maintaining a disciplined approach of looking for quality companies at reasonable valuations,” HDFC AMC said adding large-cap stocks have historically demonstrated stability during economic fluctuations and have had better risk-reward ratios.
According to the money manager, the large-cap index has outperformed mid and small-cap indices in seven of the last 17 years. “The recent sharp outperformance of mid and small caps over large caps, the large-cap segment now seems to be relatively attractive in valuations,” HDFC AMC said.
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Rahul Baijal, Senior Fund Manager-Equities, HDFC Mutual Fund, said “Large-cap stocks offer stability and better risk-adjusted return, making them an attractive option for investors looking for investment opportunities over the long term.”
