Canara Robeco Large Cap+Fund NFO: Review Analysis & Details

Another mutual fund house has decided to come out with its NFO or New Fund Offer. The Canara Robeco Mutual Fund House has launched its NFO or New Fund Offer called the Canara Robeco Large Cap+Fund NFO
In this article, we will analyse how good is this Canara Robeco Large Cap+Fund NFO, whether this Canara Robeco Large Cap+Fund offers anything new or unique for the investors and whether the investors should invest in Canara Robeco Large Cap+Fund .

Canara Robeco Large Cap+Fund NFO: Review Analysis & Details

Let's begin with some basic details about Canara Robeco Large Cap+Fund.

What are the NFO dates for Canara Robeco Large Cap+Fund ?
The NFO period for Canara Robeco Large Cap+Fund will open on 30th June and will close on 27th July 2010.

What is so unique about this Canara Robeco Large Cap+Fund?
As the name suggests, this fund from Canara Robeco is purely a large cap fund. What this fund will do is collect money from investors and invest in the TOP 150 Companies, rated as per their market capitalization value. Hence, this fund can be a good investment for individuals who believe in the large cap story and trust that large cap stocks give better returns. Here is an article with example about Relative performace of mid-cap stocks v/s large-cap stocks. However, one should note that it's only a matter of time when a particular sector outperforms the other. There is no guarantee that if Large Cap have outperformed Small caps and Midcaps in some period of time in the past, then it will continue to do so in the future as well. It is possible that after some time, the large caps returns may be less than small caps or mid caps.

By inveting in this fund, an investor is also betting on the stock picking and timing skills of the fund managers. The news reports that this fund will invest into any company shares which fall into top 150 list as per marketcap. Now that is a long list to choose from. And Active fund management i.e. where the fund manager keeps switiching from one stock to the other, may not be able to keep pace with the underlying returns.

So overall, this Canara Robeco Large Cap+Fund seems to be a focussed fund on large cap sector. Although the news claims that this fund stock selection process will use the "Robeco Emerging Markets Quantitative model", no one can guarantee anything about the returns.
The money will be invested in the following proportions:
65% to 100% - Large Cap Stocks (Top 150) and their related derivative instruments
Rest 35% in domestic debt and money market instruments

During NFO, the units of this Fund will cost Rs 10 per unit.

Are there any alternatives to Canara Robeco Large Cap+Fund?
Yes, many alternatives available. Basically you can invest in any large cap funds from other fund houses. Go a step further and invest in Index Funds (Index Funds Explained with Example). Even better would be to simply go for a large cap focussed ETF or Exchange Traded Fund. (ETF- Exchange traded fund -An example)
Mr. Anand N. Shah will be the fund manager.

The Canara Robeco Large Cap+Fund will be benchmarked to BSE 100 Index

Minimum Investment:
Purchases : Rs. 5000/- and in multiple of Re. 1 thereafter.
SIP or Systematic Investment Plan is available? - No Info

No Tax Benefit is available in the Canara Robeco Large Cap+Fund

Investment Options for Canara Robeco Large Cap+Fund :
- Growth
- Dividend (Payout and Reinvestment)

The entry load for Canara Robeco Large Cap+Fund is as follows:
Entry Load for Canara Robeco Large Cap+Fund :
Zero Entry Load

Exit Load for Canara Robeco Large Cap+Fund:
1% if the amount sought to be redeemed or switched out is invested up to 1 year from date of allocation.

Final Thoughts about the Canara Robeco Large Cap+Fund?
This fund can be a good investment for investors willing to bet on the skills of the Canara Robeco Fund Managers and who believe that large cap stock investment story