Sundaram Large Cap Fund for Better Returns Invest Now

If you wish to have exposure to well established companies from various sectors then you can go through the Sundaram large cap fund scheme and do a research before investing.

What Is Sundaram Large Cap Fund?

The Sundaram large cap fund is an equity mutual fund where the predominant investment is made in the large cap companies.

Understanding Large Cap Mutual Funds

Large cap mutual funds invest in businesses that are relatively large in size.

How Large Cap Funds Invest in Established Companies

The team at a large cap company analyzes companies prior to purchasing their stocks. Revenue growth, profitability, debt ratio, management efficiency, competitive edge, and business opportunities could be studied.

The fund manager then makes use of this research to pick and guard investments. Valuations, company fundamentals, and the market itself can all change, impacting the portfolio.

This way, investors can benefit from professional portfolio management. But professional management doesn’t mean that there is zero risk in investing; sometimes a fund manager’s choices are not successful.

Understanding Sundaram Large Cap Fund Regular Growth

The Sundaram large cap fund regular growth option is a combination of two important investment options, namely, Regular Plan and Growth option.

What Is the Regular Plan?

Most typically, a Regular Plan is bought from a mutual fund distributor, intermediary or eligible investment vehicle that is used to facilitate Regular Plan transactions.

How the Growth Option Works

Normally, under the Growth option, the profits of the scheme are not paid to the investors as and when earned, but retained with the scheme as a growth fund. The benefits, however, stay in the scheme and add to the portfolio value of the scheme; this depends on the market movements and the costs.

The value of your investment is dependent on the number of units you have invested and the NAV. Please note that if the NAV goes up, the value of your investment may go up. In the event that the NAV declines, your investment could be worth less.

The Growth option might be right for investors who prefer to grow their investment over time instead of getting periodic distributions. It does not ensure compounding at a certain rate or income, however.

Investment Objectives and Long-Term Wealth Creation

The Sundaram large cap fund investment objective is to achieve capital appreciation through investment in large cap stocks. Investors generally look at equity mutual funds for a long-term objective, which is in the future.

These objectives could range from creating a retirement fund, to saving for a kid’s schooling, to saving for something else.

Why is it that the time horizon is important? Markets may rally or fall dramatically over a short period of time. The longer one can invest, the more time they will have to deal with the volatility, but that doesn’t mean that it will always be positive.

An equity investment will need some patience and regular checks, not constant reactions to day-to-day market movements.

Prior to investing, you should have a goal in mind, determine your investment requirement, and determine your tolerance for temporary declines in your portfolio’s value.

Regular Plan vs Direct Plan

The Regular and Direct plans share the same underlying scheme portfolio and the plans vary in terms of the distribution and costs they entail.

The Sundaram large cap fund regular growth option might be suitable for investors who wish to invest via a distributor and appreciate the support they get from their distributor.

Understanding Fund Performance and Returns

Before investing in Sundaram large cap fund, check out its performance in various periods. Take into account one-year, three- year, five- year and longer-term returns if available.

When examining the returns, compare them with that of the scheme’s benchmark Nifty 100 Total Return Index. Look at the performance of the fund through bad times, as well as good.

Note the following things:

• Consistency: Check performances in varying market scenario.
• Compare the fund to its benchmark: See if the fund has followed its benchmark over similar time frames.
• Expense ratio: Understand the effect of annual expenses on your returns .
• Concentration of a portfolio: Review highest concentration and sector distribution.
• Risk: If you consider the volatility of how much the value of the fund has changed.

Please refer the official Sundaram Large Cap Fund page to get the latest NAV, portfolio, performance and expense ratio of the fund.

Common Mistakes Investors Should Avoid

No matter how well researched an investment might be, it is unlikely to turn out well if you make an investment without a clear plan. When it comes to the Sundaram large cap fund, these are some common pitfalls to avoid.

• Past performance is not necessarily indicative of future performance: A fund’s performance in the recent past is no guarantee of its performance in the future.
• Failure to account for costs: Small annual variations in costs can have a long-term impact on investment values.
• Assuming fixed growth: Equity shares may see declines in times of bad markets.
• Without a time horizon: If money is required to be invested in the near future this may not be appropriate for an equity investment.
• Daily NAV checking: This may lead to emotional trading due to daily fluctuations in the market.
• Ignoring diversification: Don’t automatically assume that one mutual fund can be a substitute for a comprehensive financial plan.
• Ignore exit loads and taxes: These can impact how much you receive upon withdrawing your investment.

Conclusion

Investors can invest in a Sundaram large cap fund as a professionally-managed equity mutual fund to gain exposure to large cap Indian companies.

The fund is, however, subject to the risk of equity market, but there is no guarantee of capital appreciation or positive returns.

FAQs

1. Is Sundaram Large Cap Fund suitable for long-term investing?

Ans) Investors with a long term investment horizon in the large cap sector who want to take the risk of market volatility may want to consider investing in the fund. Appropriateness will be based on your objectives, risk tolerance and financial situation. There is no guarantee that past performance will be a guarantee of future performance.

2. What does Sundaram Large Cap Fund Regular Growth mean?

Ans) It applies to Regular Plan (Growth). Investors can mostly use the Regular Plan via a distributor or intermediary while the Growth option will keep investment gains in the scheme and not distribute them periodically as IDCW. The investment can also go up and down as the market goes up and down.

3. Can I invest in Sundaram Large Cap Fund through an SIP?

Ans) Yes. The fund house informs the investor that he/she can invest via SIP. Details of minimum investments and other relevant terms can be found on the official fund website or your investment platform.

4. Does the Growth option pay regular income?

Ans) No. The Growth option will not typically pay out dividends “In the form of special payments” (IDCW). Rather, schemes earnings are left within the scheme. In case of frequent inflow of cash, think carefully before making any withdrawals as the money drawn through SWP may be a part of the corpus.

5. Can I lose money by investing in Sundaram Large Cap Fund?

Ans) Yes. The NAV of the fund may drop when market prices of the equities held by the fund drop. The redemption value of your units may be less than the redemption amount. Before investing, take into account the amount of risk you are willing to take and the time you will have to invest.