Best Small Cap Mutual funds have become a good market for people nowadays. By investing in mutual funds for a long period of time, you will see a lot of profit in the long run. Everyone wants to get good returns by investing in the stock market, but many people fear it because they have no knowledge of the stock market. And so these people find it very risky to invest in the stock market. At such times, people get a good opportunity to easily invest money in the stock market through mutual funds. To know best small cap mutual funds, Firstly know about small cap mutual fund.
What is Small Cap Mutual Fund?
Small cap funds are basically equity funds that mostly invest in small cap companies. The Securities and Exchange Board of India lists companies in three tiers based on capitalization value.
- Large cap: with a market capitalization of Rs 20,000 crore
- Mid cap: with market capitalization above 100 crores
- Small cap: having market capitalization below 100 crores
Small cap fund managers invest in companies that have the potential to become large companies. However, investors in these small cap stocks should be aware that the prices of small cap companies remain volatile in the market, so these funds are high-risk investments.
During the 10-year tenure of Prime Minister Narendra Modi’s government, the stock market saw a 3-fold rise. This has also had a beneficial effect on the returns of mutual fund companies.
How Much Return In Small Cap Funds Last 10 Years?
Ever since Narendra Modi became the Prime Minister till now many companies
Have come to India and invested. Hence, at this time mutual funds have given strong returns to the investors. According to a data, the mutual fund industry has registered a very rapid growth. The fund base of 195 equity schemes has grown over the last 10 years, giving them good returns.
Best Small Cap Mutual Funds In 2024
Here are list of best small cap mutual funds in 2024 with very high return in last 10 years. you need to invest in this mutual funds for better future reponse.
Sure, here is the table with the rows reordered:
| Fund Name | 1Y Returns | Fund Size (in Cr) |
| Quant Small Cap Fund | 66.3% | ₹20,164 |
| Franklin India Smaller Companies Direct Fund | 55.5% | ₹12,586 |
| Nippon India Small Cap Fund | 54.1% | ₹50,422 |
| Invesco India Smallcap Fund | 52.2% | ₹3,964 |
| HSBC Small Cap Fund | 50.1% | ₹14,619 |
| Bank of India Small Cap Fund | 48.8% | ₹1,052 |
| Edelweiss Small Cap Fund | 44.9% | ₹3,361 |
| Kotak Small Cap Fund | 42.0% | ₹14,815 |
| Canara Robeco Small Cap Fund | 41.7% | ₹10,085 |
| Tata Small Cap Fund | 41.4% | ₹6,951 |
| ICICI Prudential Smallcap Fund | 40.6% | ₹7,658 |
| SBI Small Cap Fund | 38.8% | ₹27,759 |
| Axis Small Cap Fund | 36.5% | ₹20,136 |
| IDBI Small Cap Fund | 24.3% | ₹160 |
Key Benefits Of Investing In Small Cap Mutual Funds
1. High Growth Potential:
Small cap mutual funds do well because small cap companies tend to have high growth over the long term.
2. Ability to outperform other equity funds:
While large cap and mid cap funds underperform, small cap mutual funds can give better returns.
3. Researched Diversification:
Fund managers of top small cap mutual funds invest in companies with high return potential after extensive research.
4. Flexible investment avenues:
- Lump Sum Investment: Investors can invest a lump sum in one go, with a minimum investment often of Rs. 1,000 starts.
- Systematic Investment Plan (SIP): Investors can contribute at regular intervals (monthly, quarterly, etc.), in installments of Rs. Starts as low as 100.
Risks While Investing In Small Cap Mutual Funds
1. High Volatility:
Small cap funds are highly volatile, with prices fluctuating. Due to which your investment can become risky.
2. Hazardous Performance:
The performance of a small cap fund depends on multiple factors, such as stock selection, stock performance and timely intervention by the fund manager.
3. Low Liquidity:
Small cap mutual funds are underinvested by institutional investors and retail participation is generally low.
Conclusion
Best Small Cap Mutual Funds In 2024, investing in small cap mutual funds presents both opportunities and risks for investors. So one should be very careful while investing. Over the past decade, the stock market has witnessed significant growth, leading to significant returns for mutual fund investors. Small cap funds, with their high growth potential, can be considered an attractive option for those looking for long-term investment opportunities. You have to invest in it for a long period of time.
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