Bajaj Finserv MF launches Large and Mid Cap Fund with 'moat investing' strategy — is it worth considering?

The fund will predominantly focus on large and mid-cap stocks from various sectors.

"The distinctive feature lies in its incorporation of the "Economic Moat" concept, a strategic shield protecting a company's profits against potential challenges in the dynamic business environment," Bajaj Finserv Mutual Fund said.

The minimum subscription amount allowed is ₹500 and in multiples of ₹1.

While there are no entry loads, exit load is there for each purchase of units through lumpsum/switch-in/SIP/STP, exit load as follows:

Up to 10% of units allotted – Nil

Excess of 10% of units allotted - 1% of applicable NAV

Ganesh Mohan, CEO of Bajaj Finserv Asset Management, expressed his confidence in the new offering, stating, “This NFO's approach aims to capitalise on the growth potential inherent in both large-size companies and agile midcap enterprises, allowing investors to benefit from the relative stability of established giants and the agility of rising stars.

In the current market scenario, both large-caps and a blend of large and mid-caps are trading below their long-term averages, presenting an advantageous risk-reward scenario, particularly when compared to the Nifty 500 Index.

The fund's strategic focus on economic moats within large and mid-cap stocks is based on their resilience in the face of market fluctuations and potential for sustained long-term growth, the mutual fund house said.

Nimesh Chandan, CIO of Bajaj Finserv Asset Management, highlighted the key characteristic of the fund as stock selection based on the moat investing strategy.

"This involves identifying companies with a competitive advantage that helps them defend their leadership positions, strong business metrics, and long-term value creation potential," he said.

Considering the unique investment strategy, market dynamics, and the expertise of Bajaj Finserv Asset Management, the Bajaj Finserv Large and Mid Cap Fund presents an intriguing investment opportunity.

However, as with any investment decision, it is advisable for investors to conduct thorough research, assess their risk tolerance, and consult with financial advisors before making investment choices.