Know Your Fund #4: ICICI Pru Large Cap Fund

The first thing to notice is the active share. The fund has an active share of only 39% as of March. That means a large part of the portfolio overlapped with the Nifty 100 at that point.

Lower active share is theoretically more likely in large-cap funds because the investible universe is smaller. A large-cap fund mostly chooses from India’s top 100 companies, so it naturally has less room to look very different from the benchmark. Still, investors should take note of this. While we don’t know how the active share looked historically, the current number raises a question: if the fund is not very different from the index, why not just buy an index fund?

Let's check rolling returns. Over the last 7 years, the fund beat the Nifty 100 TRI in 67% of 3-year periods and 79% of 5-year periods. So while the portfolio may not look very different from the index today, the fund has managed to beat the benchmark in a decent share of longer holding periods.

The next point is downside protection. A look at the Sortino ratio, max drawdown, volatility, and downside capture ratio shows that the fund has handled weak markets better than its peers.

There is also one important change to watch. Anish Tawakley, who had been associated with the fund since 2018, has moved out. Sankaran Naren, the chief investment officer of the fund house, has now taken the helm along with the existing team.

Previous fund covered: HDFC Mid Cap Fund.

For the methodology, check the link in the comments.