Best Small and Midcap fund to invest

The small and mid cap category has been giving great returns. By investing in the firms that have the ability to grow faster than large caps firms, these categories have been doing exceptionally well. Here are the top 10 funds in these categories that you can invest your money for a long term (minimum 7 years).

Upwardly presents to you the best small and midcap fund for 2019 – 2020

SBI Small Cap Fund

SBI Small Cap Fund is one of the best small cap mutual fund. This high-risk fund is an emerging star in the category. It looks for five attributes in the stocks it buys. They are, competitive advantage, return on capital, growth, management, and valuation. The scheme seeks to provide investors with opportunities for long-term growth in capital along with the liquidity of an open-ended scheme by investing predominantly in a well-diversified basket of equity stocks of small-cap companies.

The fund has reopened subscriptions through SIP more from May 16th, 2018. The fund hasn’t taken any fresh investments since October 2015. Over three years and five years, the fund has been ahead of its benchmark by 5-10 percentage points. Compared to the category, it has managed 1-2 percentage point outperformance. A SIP of ₹5,000 p.m. in this fund started 5 years ago is worth ₹4.65 lakhs now.

 

Reliance Small Cap Fund

This is one of the rare funds in the equity space which has beaten the benchmark as well as the category across all the time frames: one year, three years, five years or even seven years. It is one of the best small cap fund. Managing solid performance, even in bear phases, without leaning on large-caps is credible. Over three and five years, the fund has been ahead of its benchmark by 5 to 9 percentage points. Compared to the category, it has managed 3 to 5 percentage point outperformance. A SIP of ₹5,000 p.m. in this fund started 5 years ago is worth ₹4.35 lakhs now.

 

HDFC Small Cap Fund

The fund aims at providing long-term capital appreciation, by investing at least 65% in small-cap companies and targets high-quality small-cap business which is undervalued and have a sustainable business. Over three and five years, the fund has been ahead of its benchmark by 8 to 4 percentage points. Compared to the category, it has managed 7 to 1 percentage point outperformance. A SIP of ₹5,000 p.m. in this fund started 5 years ago is worth ₹4.50 lakhs now.

 

Franklin India Smaller Companies Fund

This fund has outperformed its benchmark without a break for the last nine years. In terms of investing style, it manages a balance between businesses with an acceptable level of quality, growth, and sustainability. Over three and five years, the fund has been ahead of its benchmark by 1 to 4 percentage points. Compared to the category, it has managed 2 percentage point outperformance. A SIP of ₹5,000 p.m. in this fund started 5 years ago is worth ₹3.92 lakhs now.

 

DSP Small Cap Fund

DSPBR Small Cap Fund follows a bottom-up approach to picking stocks. The fund managers buy and hold the stocks that they believe are growth-oriented and have a competitive edge over their peers. They strongly believe in valuation and are unwilling to compromise on quick gains. While they believe in long-term gains they are unaffected by the short-term volatility in the small-cap world. Over five years, the fund has been ahead of its benchmark by 5 percentage points. Compared to the category, it has managed 4 percentage point outperformance. A SIP of ₹5,000 p.m. in this fund started 5 years ago is worth ₹3.87 lakhs now.

 

Kotak Emerging Equity Scheme

The fund invests in companies that are priced at a discount to the intrinsic value. To select companies, the fund goes through a process. It selects only those companies that have good financial strength and relatively less prone to recession. The find invests 65-70% in mid-caps, 25-30% in small-caps, 5-10% in large-caps. On a three and five-year basis, it has outperformed its benchmark by 3 to 6 percentage points and category by 3 to 5 percentage points. A SIP of ₹5,000 p.m. in this fund started 5 years ago is worth ₹4.17 lakhs now.

 

L&T Midcap Fund

This fund’s strategy is a blend of growth and value styles of investing. The focus is on owning fundamentally strong and scalable businesses with a good management track record, at reasonable valuations. The fund’s asset allocation reveals a 15-20 percent allocation to small-cap stocks, while mid-cap allocation is about 80-85 percent, with the rest parked in large caps. This may result in a lower risk profile, while also moderating the returns from this fund. With 3-year and 5-year annualized returns of 17.81% and 23.05% respectively, the fund has outperformed its benchmark by 3 to 5 percentage points and peers by 3 to 5 percentage points. A SIP of ₹5,000 p.m. in this fund started 5 years ago is worth ₹4.21 lakhs now.

 

Franklin India Prima Fund

The fund focuses its portfolio on mid-cap and small-cap funds, with more inclination towards the mid-cap businesses. It follows a growth at a reasonable price strategy. The fund consistently outperformed its benchmark in the last 8 years. With 14.90% and 20.77% 3 and 5 year returns respectively, it outperformed both of its benchmark and category. The five-year returns were 1 percentage point ahead of the benchmark and 2 percentage points more than category. A SIP of ₹5,000 p.m. in this fund started 5 years ago is worth ₹4.09 lakhs now.

 

Axis Midcap Fund

The fund predominantly invests in mid-cap companies. They include innovative and entrepreneurial companies with experienced management. They concentrate on high growth companies and market leaders in emerging industries. On three and five-year returns, it has outperformed both its benchmark and category by 2 to 3 percentage points. A SIP of ₹5,000 p.m. in this fund started 5 years ago is worth ₹4.17 lakhs now.

 

HDFC Mid-Cap Opportunities Fund

This fund is a remarkably consistent performer in this category. The fund’s three-year return, at 15.91%, is 1 percentage point ahead of the benchmark and 2 percentage points ahead of its category returns. The five-year returns, at 20.48%, are 2 percentage points higher than both benchmark and category returns. What stands out in its annual returns is its ability to weather any kind of bear market. In 2008, 2011 and 2013, this was a rare mid-cap fund to contain losses to levels far lower than those of its benchmark. The popularity has resulted in rapid growth of the fund’s size, from under Rs 10,000 crore in early 2016 to over Rs 20,000 crore now. This makes it by far the largest fund in this category. A SIP of ₹5,000 p.m. in this fund started 5 years ago is worth ₹4.08 lakhs now.

 

 Invest in the best small and midcap fund with Upwardly.

 

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