Large Cap Mutual Funds

Invest in Large Cap Mutual Funds to get access to India's top 100 companies by market capitalisation. Explore funds that deliver 3-year annualised returns of 18.17% and maintain a lower risk profile than flexi-cap, mid-cap, and small-cap funds. They offer the flexibility to withdraw funds at your convenience.

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3-year Annualised Returns of 18.17%

3-year Annualised Returns of 18.17%

Comparatively Lower Risk than Small and Mid-Cap

Comparatively Lower Risk than Small and Mid-Cap

Withdraw your money anytime

Withdraw your money anytime

Ideal for Long-Term Investment

Ideal for Long-Term Investment

Best Large Cap Mutual Funds to Invest


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What are Large Cap Mutual Funds?

Large Cap Mutual Funds invest your money in the biggest and most stable companies in the stock market - firms with a market cap above ₹20,000 crores. With a record of providing a steady average return of 18.17%, these funds present a lower-risk option for your investment portfolio as compared to other mutual funds like flexi-cap, mid-cap, and small-cap funds. As per SEBI, these funds invest 80% of their assets in the top 1 to 100 companies on the stock exchange.

How Do Large Cap Mutual Funds Work?

Large Cap Mutual Funds invest your money in the biggest and most stable companies in the stock market - firms with a market cap above ₹20,000 crores. As per SEBI, these funds invest 80% of their assets in the top 1 to 100 companies on the stock exchange. With a record of providing a steady average return of 18.17%, these funds present a lower-risk option for your investment portfolio. 

Benefits of Investing in Top Large Cap Mutual Fund

Adding Large Cap Funds to your investment mix can offer stable returns. Let’s see how!

  • Steady in Rough Markets

    These funds invest in large companies that are often less affected by market ups and downs, providing a much steadier investment option.

  • Proven Performers

    The companies in Large Cap Funds have a history of consistent performance, which can mean more predictable results and reliable growth of your investment.

  • Spread Out Risk

    By including Large Cap Funds, you diversify your risk across different companies and sectors, which can protect your portfolio from unexpected market shifts.

  • Easy to Start

    You can invest in these funds even with a small amount of money and it's simple to buy or sell your investment.

  • Lower Management Effort

    With Large Cap Funds, the need to closely monitor and manage your investment is reduced because you're investing in well-established companies.

  • Long-Term Growth

    These funds are known for their potential to deliver growth over time, making them a good match for long-term financial goals like retirement savings.

Limitations of Investing in Equity Large Cap Funds

Even with their advantages, these funds come with certain limitations to consider:

  • Slow Growth Potential

    These funds often grow more slowly than those investing in smaller, fast-growing companies. The size of the companies in large cap mutual funds can limit how much they grow.

  • Lower Gains in Bull Markets

    In a strong market rally, large cap funds may not increase as much in value as funds focused on smaller companies that can spike quickly.

  • Dividend Focus

    Some large cap funds focus on paying dividends rather than reinvesting for growth, which can further limit their value increase over time.

  • Low Reward for Low Risk

    The trade-off for lower risk is usually lower returns. If the market booms, these funds might not rise as much as others.

  • Popularity Can Limit Returns

    When lots of investors flock to these safe assets, the buy-in price can go up, potentially lowering future returns.

  • Influence of Market Leaders

    A few large companies can heavily influence the fund's performance, which can be a risk if those companies don't do well.

Who should invest in best Large Cap Funds?

Investing in top-ranked large cap mutual funds is not a cup of tea for everyone. Let us read below to know which investors could benefit the most from large cap investments:

  • Investors Seeking Stability

    If you are someone who is looking to invest in equity but wants stability in their portfolio, large cap MF is the best option. These funds are known for providing financial stability to investors along with enduring any market downturns.

  • Risk-Averse Investors

    Investing in equity funds consists of significant risks, irrespective of the type. But compared to small-cap funds or mid-cap funds, large-cap mutual funds are less risky as the companies are stable and strong.

  • Consistency in Performance

    Large-cap funds offer steadiness to your investment portfolio. As these companies are stable and are not highly impacted due to market changes, their returns are mostly consistent.

Points to consider before investing in Large Cap Mutual Funds

  • Checking Investment Risks

    Understanding your own risk-taking capability is crucial. Larger funds usually have fewer ups and downs in their value compared to smaller ones.

  • Aligning Personal Financial Goals with Fund Goals

    Make sure the fund's goals match your personal finance goals. Know the fund manager's style and experience to understand how the fund might perform.

  • Understanding Exit Costs

    Exit load is the fee you pay when you take your money out. This is charged to discourage short-term trading and to reimburse the fund for any expenses connected with the early redemption of units. Low exit costs mean you get more money back, so pay attention to this when deciding where to invest.

  • Checking Past Performance

    Look at how the fund has performed in the past. Choose a fund that shows decent returns in different market conditions.

  • Cost Comparison

    Be sure to compare the costs of different investment options. Larger funds come with costs, known as the expense ratio. The lower the ratio, the higher your overall profits.

  • Know Your Fund Manager

    The person managing the fund decides its fate. Experienced fund managers can guide your investments based on their knowledge and expertise, helping you make more secure and profitable choices.

How to start investing in Large Cap Mutual Funds with INDmoney?

Now that you have understood what is large cap mutual fund, you need to know how easily you can start your investment with INDmoney. Just follow these simple steps given below, to start your mutual fund investment journey with us.

  • Step 1

    Download the INDmoney app and create your free investment account by   completing your KYC ( Know Your Customer).

  • Step 2

    Once your Free investment account is ready, you can either search for a large cap mutual fund or go to the mutual fund section and tap on large cap mutual funds.

  • Step 3

    Choose a large Cap Mutual Fund by looking at aspects like past returns, volatility, downside capture ratio, AUM, Expense ratios and underlying stocks and sectors.

  • Step 4

    You can choose to set up SIP in large cap mutual funds or even invest as lumpSum. Once you are on the individual large cap mutual fund page click from the bottom “One-time” for lump sum investment or “SIP” for systematic investment plan. 

  • Step 5

    Choose the amount that you want to invest as SIP or LumpSum.

  • Step 6

    Set up payments. If you choose to set up SIP in large cap mutual funds,  you can do a free automatic pay set up via bank mandate or UPI. If you choose to invest in lumpsum (one-time) then you can pay via UPI, netbanking, NEFT or RTGS.


Taxation on Large Cap Funds

In India, the profits you make from large cap mutual funds are subject to taxation, which depends on how long you hold your investment. This is what you need to know:

  • Short-term capital gains (STCG): If you sell your mutual fund units within a year of buying them, any profit you make is counted as short-term capital gains and is taxed at 15%.
  • Long-term capital gains (LTCG): If you sell your units after holding them for more than a year, the profit is considered long-term capital gains. Here, any gains above ₹1 lakh in a financial year are taxed at 10% without the benefit of indexation.

Frequently Asked Questions

Large-cap Cap funds are often run by well-reputed AMCs which offer steady and consistent results and have less volatility. Some of the best-performing large-cap funds you can invest your money in 2024 are:

  • Axis Bluechip Fund
  • Canara Robeco Bluechip Equity Fund
  • Sundaram Large Cap Fund
  • Mirae Asset Emerging Bluechip Fund

Your returns from large-cap mutual funds will be taxed under two categories.

  • Under Capital Gains: Short-term capital gains at 15%; Long-term capital gains (over Rs. 1 lakh) at 10%.
  • Tax on Distributed Income Dividend Option: At applicable income tax slab

Yes, large cap mutual funds have certain risks involved with them, but they are not as high as mid cap or small cap funds. For this reason, the returns on these funds are stable and suitable for conservative investors.

As an investor, you should look at the following features of a large-cap mutual fund before making a decision.

  • Historical performance of the fund manager
  • Expense ratio
  • Past performance of the large-cap MF
  • Fund portfolio

Try to invest your money in a large-cap fund for a minimum of 3 to 5 years to get a good return after the tenure ends.

The average return on a one-year large-cap mutual fund is generally 16.15% depending on the market. However, as the market is volatile, you cannot expect to get the same return as you got in the previous years.

While large cap funds are generally safer than other types of funds like small cap or mid cap funds, they are not completely risk-free. The value of your investment can go down if the companies the fund invests in perform poorly.

It's a good idea to check on your investments at least once a year. This helps you understand how your funds are performing and whether you need to make any changes based on your financial goals or market conditions.

Large cap funds are typically recommended for long-term investments because of the nature of equity markets. For short-term goals, less volatile investment options like debt mutual funds might be more suitable.

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