With the stock market having corrected more than 10 per cent so far this year, Birla Sun Life Front Line Equity Fund, given its focussed exposure to blue-chips and proven ability to ride out corrections, makes for a good investment option. Though the fund's performance over the year has not been impressive — it lagged some of its peers — its large-cap focus, which suggests that the fund has placed its bets on companies with relatively better earnings prospects, lends confidence.

A long-term track record of good performance and having beaten its benchmark BSE-200 over different market phases too adds to our investment case. Over a five-year period, the fund has delivered a compounded annual return of over 19 per cent. While the fund makes a good addition to the core portfolio of mutual fund investors, its typically large-cap focussed portfolio can also limit its participation in secular market rallies. It, therefore, is best suited for low-risk investors, who are looking only for steady returns.

Performance : BSL Frontline Equity Fund has delivered about 12 per cent and 6 per cent returns on a one- and three-year (compounded return) basis.

While one-year returns have lagged that of peer funds such as HDFC Top 200, Franklin India Blue Chip and Principal Large Cap, its returns on a three-year and five-year basis remain impressive (it lagged HDFC Top 200 in all the three time-periods though).

What's more, the fund has consistently performed better than its benchmark during market corrections. For instance, in the brief corrective phases seen in 2004 and 2006 or the long-drawn-out one seen in 2008, the fund's returns have bettered that of its benchmark. This ability to weather corrective phases adds to its appeal, especially given the present market conditions.

That said, the fund's extent of participation in market upswings has been rather limited, thanks to its predominant large-cap focus.

Its ability to change tack, in sync with market trends, however provides comfort. It managed to make the right market calls in the tough 2007-2009 period. For instance, while most equity funds struggled to mirror market returns in 2009, BSL Frontline upped its equity exposure quick enough to benefit from the massive rally that followed post the elections.

Portfolio : Roughly about four-fifths of its portfolio is invested in companies with market capitalisation of more than Rs 7,500 crore.

The remaining is apportioned between select mid- and small-cap stocks (9 per cent and 3 per cent respectively) as well as cash (7 per cent).

The fund's portfolio is also highly diversified, with no individual stock enjoying more than 5 per cent exposure — its top five stocks account for 20 per cent of its portfolio.

In terms of sector exposure, the top three — financials, energy and IT — make up over 46 per cent of its December portfolio.

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