Mirae Asset Emerging Bluechip Fund
- What is this fund all about?
Mirae Asset Emerging Bluechip Fund (MAEBF) is primarily a Mid-cap equity mutual fund which gives investors the opportunity to participate in the growth story of today's relatively medium size but emerging companies which have the potential to be well-established in the future.
Where does it invest?
Mirae Asset Emerging Bluechip Fund focuses on investing in companies which are small today in terms of market capitalization but have the potential to grow in the long term. The fund will primarily invest in emerging Bluechip companies, companies which have a market cap of at least Rs. 100 crores but do not form part of the top 100 companies by market capitalization [as per National Stock Exchange (NSE)] at the time of investment. A Bluechip stock is the stock of a well-established company with stable earnings and no extensive liabilities.
- Why should you invest in it?
Emerging Bluechip companies offer relatively better return potential as is evident from the reasons below:
Performance: Data analyzed over the past several years shows that small and mid-cap indices have outperformed large-cap indices. A consistent track record of outperformance by emerging Bluechip companies makes them an exciting investment proposition.
High earnings growth: CNX Mid-cap Index is offering higher earnings growth for FY11 and FY12 (based on consensus forecasts) compared to Sensex. Momentum in earnings upgrade cycle for CNX Mid-cap Index has sustained versus pause/ decline in earnings for Sensex.
Reasonable valuations: CNX Mid-cap index is trading at 20-30% discount to Sensex based on P/ E and P/ B ratio which makes investing in mid-cap funds an attractive proposition. Source: CLSA, Feb 2010
Future scope: There is scope for P/E multiples to expand when a company moves up from a small/ mid-cap size to a large-cap