Fund of Fortnight

Reliance Large Cap Fund - Direct Plan (Growth)



Reason for recommendation -The market has started showing signs of nervousness before the election result and has thus become volatile. Although election results barely impact the long-term performance of the equity market, it definitely impacts the short-term returns. Hence, it becomes important to invest in funds that have shown stability in returns in every situation. Reliance Large Cap Fund, which was earlier known as Reliance Top 200, being a large-cap dedicated fund has shown considerable stability during volatile times. The risk-adjusted return of the fund in the last one year has been one of the best among its category. The reason for such performance is because the fund takes significant underweight and overweight positions in the sectors depending upon the conviction of the fund manager. This strategy has largely helped the fund to perform. Even now the top 10 stocks constituted 52.9 per cent of its total AUM and top 3 stocks constituted 55.85 per cent of the AUM at the end of March 2019. Sailesh Raj Bhan, the Fund Manager has been at the helm of affairs since 2007. Currently, the fund is overweight on Financial Services and Industrials sector compared to its category, while it is underweight on Technology. We believe that these bets of the fund manager will play out, if not in the immediate future, definitely over the medium to long-term. Even in terms of stock, the fund is heavily betting on a couple of large-cap banks. Till now these banks have shown better financial performance that has reflected in their stock price movement. The fund is suitable for a moderate risk taker who is willing to remain invested for a longer duration.