Canara Robeco Bluechip equity fund has an AUM of approximately Rs. 10,000 Crore. While the majority of active large-cap funds have underperformed the benchmark for the past many years, this fund has managed to outperform it’s peers and the benchmark by wide margins.
Is Canara Robeco Bluechip Equity Fund Good for Long Term?
The chart below shows that the 5-year trailing returns of the scheme is 15.12% while that of 7 year is 15.55%.
In both the time frames the fund has managed to outperform the benchmark and the category average.
If you had invested Rs 1 lakh in this fund 5 years ago, you would have over Rs 2 lakh as against Rs 1.8 lakh in the case of the large-cap category and 1.85 lakh in the case of the BSE 100.
How Is Canara Robeco Bluechip Equity Fund Managed?
We had to look at several data points to determine why this fund has done well.
After sifting through them, we have found the key reasons.
Let’s see them one by one.
1. A low expense ratio
Don’t be surprised to find the mention of the expense ratio right at the start.
In the large-cap space, the expense ratio plays a significant role in a fund’s underperformance or outperformance.
That’s because the universe of large caps is rather limited. It has just the 100 largest stocks by market capitalization.
Since active large-cap funds must invest at least 80% of their corpus in such stocks, they have limited room to outperform the indices via stock selection.
That’s the reason for the underperformance of many active large-cap funds.
A low expense ratio can help boost a fund’s returns in such a scenario.
Is It Good to Invest In Canara Robeco Bluechip Equity Fund?
The above two sections have provided a reasonable overview of how the fund is performing and the factors that are helping the scheme achieve this. Apart from this, you can also consider the near-term performance of this scheme that can help you make decisions
The first point is the near-term returns of the fund vis-a-vis its category and benchmark.
If we look at the 3-year returns, signs of fatigue in performance are visible. The fund is behind both the category and the benchmark.