What Are Small Cap Mutual Funds?

What Are Small Cap Mutual Funds?

Blog Article

small cap mutual funds in india invest in companies that rank beyond the top 250 by market capitalization in India. These companies are typically younger, growing businesses with substantial potential.

Why Invest in Small Cap Mutual Funds in India?

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  High growth potential: These companies can grow faster than established large caps.

  
  


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  Undervalued opportunities: Many small cap stocks are not widely tracked, offering value buys.

  
  


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  Portfolio diversification: Adds a growth-driven segment to your investment portfolio.

  
  

But these funds also carry higher risk due to:

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  Market volatility

  
  


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  Limited financial history of the underlying companies

  
  


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  Lower liquidity in some cases

  
  

Because of this, combining a SIP strategy with small cap funds can be the ideal way to manage risk while benefiting from long-term returns.

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