A Blue-chip Fund is considered to be relatively safe among equity-oriented funds in comparison to large & mid-cap funds, focussed equity funds, small-cap funds and sector/thematic funds. A Blue-chip or a Large-cap Fund
tends to withstand market volatility betterin comparison to other equity-oriented mutual funds because it invests in large-cap companies. And as mentioned above, large-cap companies have an inherent competitive advantage.
Due to this, the fund can handle economic shocks better and generate relatively steady returns.