Small Cap Funds: Achieving Financial Freedom & Profiting Forever
Starting and setting up a business is not a cakewalk, but it is a laborious, cost intensive and labor-intensive job to grow into a successful business empire. On the other hand, Startups are playing quintessential role in expanding the economy. With the progress of science and technology, new ideas and innovation are blooming and booming which needs a deep research and development. Startups are those brightly lit up lamps which are guiding the economy towards a broader way for achieving foreign currency and global acclamation.
A business startup fund can offer the capital required to launch and support the expansion of a new company. Startups create jobs, which is diminishing the unemployment rates, which in turn signifies a more developed and better-functioning economy. Owing to this India is holding the position of third-largest market share for startups.
Deliver Innovation! Think Boldly and Make a Better Way to Go Further!!!
Starting a firm and maintaining it is extremely painstaking and expensive. To reach up to the zenith you need to have a continuous flow of money which you can use as primary capital to manage the day-to-day activities. Borrow funding from outside can also help to safeguard the owners’ personal assets, which is way too advantageous to them. There are several alternative finance options accessible if you’re having problems getting funding from traditional sources. Small Cap funds are the newest addition in the list of potential funding sources. The companies which has a market capitalization of less than INR 5,000 crore is known as small-cap company, and the funds which are dedicated to invest in such companies are known as small-cap fund.
According to SEBI, The top 100 stocks will be classified as large cap stocks. The 101st to the 250th stock will be classified as mid-cap stocks and the stocks beyond the rank of 251 will rank as small cap stocks. A small cap fund has to mandatorily invest 85% of its corpus in these small cap stocks.
Distinguished features of Small-Cap Funds
• Small cap funds invest predominantly in small cap stocks with a very small portion invested in higher market cap categories.
• Liquidity is a major challenge for small cap funds. It is tough to find small cap stocks in the numbers and volumes that funds require.
• Many small cap funds in the past have been forced to stop fresh inflows to avoid falling short of choice of small caps to invest in.
• Small cap stocks are typically focused companies with a single line of business and little diversification in the core business.
• Small cap stocks are riskier compared to the mid-caps and the large caps and their price movements can be quite volatile.
• Small caps typically outperform large cap funds over a longer period of time due to stocks in their portfolio having a higher growth potential.
• Although small-cap funds can deliver very high returns, sometimes taking over other equity-oriented funds under favorable conditions, they also come with high risks. These companies lack the financial resources to combat the tough market conditions and may succumb to bearish markets. Hence, they are highly volatile.
Top Small Cap Funds in India
Axis Small Cap Fund: The Axis Small Cap Fund has given 34.79% annualized returns in the past three years and 27.62 percent in the last 5 years. The Axis Small Cap Fund belongs to the Equity category of Axis Mutual Funds. The minimum amount required to invest in Axis Small Cap Fund via lump sum is ₹100 and via SIP is ₹100. Their minimum investment amount is only INR 100. Their cumulative sum of the market value of total securities or Assets Under management (AUM) is worth of INR 16,175 crore.
HDFC Small Cap Fund: The HDFC Small Cap Fund has given 42.4% annualized returns in the past three years and 22.36 percent in the last 5 years. The HDFC Small Cap Fund belongs to the Equity category of HDFC Mutual Funds. The minimum amount required to invest in HDFC Small Cap Fund via lump sum is ₹100 and via SIP is ₹100. Their cumulative sum of the market value of total securities or Assets Under management (AUM) is worth INR 23,251 crore. Presently, they are offering as much as 40.6% return annually.
SBI Small Cap Fund: The SBI Small Cap Fund has given 34.04% annualized returns in the past three years and 24.45% in the last 5 years. The SBI Small Cap Fund belongs to the Equity category of SBI Mutual Funds. The minimum amount required to invest in SBI Small Cap Fund via lump sum is ₹5,000 and via SIP is ₹500. Their cumulative sum of the market value of total securities or Assets Under management (AUM) is worth INR 21,320 crore.
Nippon India Small Cap Fund: The Nippon India Small Cap Fund has given 45.81% annualized returns in the past three years and 27.54% in the last 5 years. The Nippon India Small Cap Fund belongs to the Equity category of Nippon India Mutual Funds. The minimum amount required to invest in Nippon India Small Cap Fund via lump sum is ₹5,000 and via SIP is ₹100. Their cumulative sum of the market value of total securities or Assets Under management (AUM) is worth INR 37,374 crore.
Kotak Small Cap Fund: The Kotak Small Cap Fund has given 37.6% annualized returns in the past three years and 26.62% in the last 5 years. The Kotak Small Cap Fund belongs to the Equity category of Kotak Mahindra Mutual Funds. The minimum amount required to invest in Kotak Small Cap Fund via lump sum is ₹100 and via SIP is ₹100. Their cumulative sum of the market value of total securities or Assets Under management (AUM) is worth INR 21,320crore.
In a nutshell, Small-cap funds or small-capitalization funds are investing majorly in stocks of small companies. According to the market experts, in the long term, this Small Cap Mutual Fund category is capable of giving the maximum return on one's money. This is because it moves faster than large-cap, and mid-cap mutual fund plans. The Association of Mutual Funds in India data exhibited that, since the last few months small-cap and mid-cap have consistently outperformed the large-cap space by a wide margin.
So, it is clear like broad daylight that, these funds are quite appropriate for the investors with high-risk appetites who can invest for the long term. You need to include small-cap funds in your investment portfolio with funds that have been performing well for the past 3 to 5 years to diversify the portfolio and earn good returns on investment.
A business startup fund can offer the capital required to launch and support the expansion of a new company. Startups create jobs, which is diminishing the unemployment rates, which in turn signifies a more developed and better-functioning economy. Owing to this India is holding the position of third-largest market share for startups.
Deliver Innovation! Think Boldly and Make a Better Way to Go Further!!!
Starting a firm and maintaining it is extremely painstaking and expensive. To reach up to the zenith you need to have a continuous flow of money which you can use as primary capital to manage the day-to-day activities. Borrow funding from outside can also help to safeguard the owners’ personal assets, which is way too advantageous to them. There are several alternative finance options accessible if you’re having problems getting funding from traditional sources. Small Cap funds are the newest addition in the list of potential funding sources. The companies which has a market capitalization of less than INR 5,000 crore is known as small-cap company, and the funds which are dedicated to invest in such companies are known as small-cap fund.
According to SEBI, The top 100 stocks will be classified as large cap stocks. The 101st to the 250th stock will be classified as mid-cap stocks and the stocks beyond the rank of 251 will rank as small cap stocks. A small cap fund has to mandatorily invest 85% of its corpus in these small cap stocks.
Distinguished features of Small-Cap Funds
• Small cap funds invest predominantly in small cap stocks with a very small portion invested in higher market cap categories.
• Liquidity is a major challenge for small cap funds. It is tough to find small cap stocks in the numbers and volumes that funds require.
• Many small cap funds in the past have been forced to stop fresh inflows to avoid falling short of choice of small caps to invest in.
• Small cap stocks are typically focused companies with a single line of business and little diversification in the core business.
• Small cap stocks are riskier compared to the mid-caps and the large caps and their price movements can be quite volatile.
• Small caps typically outperform large cap funds over a longer period of time due to stocks in their portfolio having a higher growth potential.
• Although small-cap funds can deliver very high returns, sometimes taking over other equity-oriented funds under favorable conditions, they also come with high risks. These companies lack the financial resources to combat the tough market conditions and may succumb to bearish markets. Hence, they are highly volatile.
Top Small Cap Funds in India
Axis Small Cap Fund: The Axis Small Cap Fund has given 34.79% annualized returns in the past three years and 27.62 percent in the last 5 years. The Axis Small Cap Fund belongs to the Equity category of Axis Mutual Funds. The minimum amount required to invest in Axis Small Cap Fund via lump sum is ₹100 and via SIP is ₹100. Their minimum investment amount is only INR 100. Their cumulative sum of the market value of total securities or Assets Under management (AUM) is worth of INR 16,175 crore.
Tata Small Cap Fund: The Tata Small Cap Fund belongs to the Equity category of Tata Mutual Funds. The minimum amount required to invest in Tata Small Cap Fund via lump sum is ₹5,000 and via SIP is ₹150. The Current Net Asset Value of the Tata Small Cap Fund - Direct Plan is INR 32.77 for Growth option of its direct plan. Its trailing returns over different time periods are: 33.46% (1yr), 42.43% (3yr) and 27.18 percent. Their cumulative sum of the market value of total securities or Assets Under management (AUM) is worth INR 6135 crore.Always remember to invest smartly for a secure future to embrace a brighter tomorrow.
HDFC Small Cap Fund: The HDFC Small Cap Fund has given 42.4% annualized returns in the past three years and 22.36 percent in the last 5 years. The HDFC Small Cap Fund belongs to the Equity category of HDFC Mutual Funds. The minimum amount required to invest in HDFC Small Cap Fund via lump sum is ₹100 and via SIP is ₹100. Their cumulative sum of the market value of total securities or Assets Under management (AUM) is worth INR 23,251 crore. Presently, they are offering as much as 40.6% return annually.
SBI Small Cap Fund: The SBI Small Cap Fund has given 34.04% annualized returns in the past three years and 24.45% in the last 5 years. The SBI Small Cap Fund belongs to the Equity category of SBI Mutual Funds. The minimum amount required to invest in SBI Small Cap Fund via lump sum is ₹5,000 and via SIP is ₹500. Their cumulative sum of the market value of total securities or Assets Under management (AUM) is worth INR 21,320 crore.
Nippon India Small Cap Fund: The Nippon India Small Cap Fund has given 45.81% annualized returns in the past three years and 27.54% in the last 5 years. The Nippon India Small Cap Fund belongs to the Equity category of Nippon India Mutual Funds. The minimum amount required to invest in Nippon India Small Cap Fund via lump sum is ₹5,000 and via SIP is ₹100. Their cumulative sum of the market value of total securities or Assets Under management (AUM) is worth INR 37,374 crore.
Kotak Small Cap Fund: The Kotak Small Cap Fund has given 37.6% annualized returns in the past three years and 26.62% in the last 5 years. The Kotak Small Cap Fund belongs to the Equity category of Kotak Mahindra Mutual Funds. The minimum amount required to invest in Kotak Small Cap Fund via lump sum is ₹100 and via SIP is ₹100. Their cumulative sum of the market value of total securities or Assets Under management (AUM) is worth INR 21,320crore.
In a nutshell, Small-cap funds or small-capitalization funds are investing majorly in stocks of small companies. According to the market experts, in the long term, this Small Cap Mutual Fund category is capable of giving the maximum return on one's money. This is because it moves faster than large-cap, and mid-cap mutual fund plans. The Association of Mutual Funds in India data exhibited that, since the last few months small-cap and mid-cap have consistently outperformed the large-cap space by a wide margin.
So, it is clear like broad daylight that, these funds are quite appropriate for the investors with high-risk appetites who can invest for the long term. You need to include small-cap funds in your investment portfolio with funds that have been performing well for the past 3 to 5 years to diversify the portfolio and earn good returns on investment.
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