Mutual funds give investors a way to make profits while building a diverse portfolio. Blue chip funds are regarded as one of the safer alternatives among the several mutual fund categories for investors seeking long-term wealth gain. One of the most well-liked big cap mutual fund schemes in India is the SBI Blue Chip Fund, which is managed by SBI Mutual Fund. Let’s examine a few of the main advantages of purchasing sbi blue chip fund.
1. Exposure to quality large cap stocks
The primary investments made by the SBI Blue Chip Fund are in large-cap firms that are well-known as well as industry leaders. The fund focuses on making investments in premium businesses with a solid track record of success and the potential to provide sustained returns over time. Investing in a portfolio of large-cap stocks like this somewhat reduces the risks associated with individual companies.
2. Experienced fund management
One of the biggest as well as most reputable asset management firms in India, SBI Funds Management Pvt. Ltd., is in charge of overseeing the fund. Since the fund’s launch in 2003, Mr. Saurabh Nanavati has been the fund manager for SBI Blue Chip. His two decades of research experience in company analysis as well as investment prospects enable him to make well-informed conclusions. The stability as well as continuity of the investment strategy are guaranteed by the regularity of fund management.
3. Relatively lower risk
In comparison to mid-cap as well as small-cap funds, the SBI Blue Chip Fund has comparatively reduced risk since it owns large-cap equities as well as a diverse portfolio of high-quality firms. In contrast, the fund’s NAV changes are often less erratic. Because of this, it is appropriate for cautious investors seeking reduced risk long-term capital building. Over time, the fund seeks to provide returns that match or exceed those of the Nifty 50 index.
4. Tax efficient structure
Section 80C of the Income Tax Act provides tax benefits for SBI Blue Chip Fund, an open ended equity linked savings plan (ELSS). You can deduct up to Rs. 1.5 lakhs from your investments in a financial year. As long as you retain the investment for a minimum of three years, all income or capital gains from the fund are likewise tax-exempt. Because of this, it’s a desirable investment instrument for generating wealth as well as reducing taxes.
5. Proven long term track record
SBI Blue Chip Fund was established in 2003 and has been around for more than 19 years. Over the course of ten years and from its beginning, it has continuously produced returns of over 12–13% on an annualized basis. Over time, the fund has beaten the Nifty 50 index, which serves as its benchmark. For investors with a long-term investment horizon of five to seven years or longer, this dependable investment option has a strong performance history.
Conclusion
The sbi equity hybrid fund Fund provides investors with exposure to high-quality large-cap equities, knowledgeable fund management, a reduced risk profile, tax advantages, and shown long-term performance. Its emphasis on investing in market leaders with solid 5paisa fundamentals makes it a good choice for methodically accumulating long-term wealth.
