Best Performing Small Cap Funds

1. Quant Small Cap Fund 

Quant Small Cap Fund is an Equity Scheme launched by Quant Mutual Fund. Currently, this fund is managed by Mr. Sanjeev Sharma. It is one of the top-performing Small-cap fund on the list. The fund tracks the NIFTY’s Small Cap 250 Total Return Index & has a category average return of 29.32% p.a. in three years. Whereas, this fund has given a 3Y annualised return of 54.96%.

2. Canara Robeco Small Cap Fund 

A Equity Scheme launched by Canara Robeco Mutual Fund and managed by Mr. Shridatta Bhandwaldar. This fund has a category average returns of 29.32% p.a. over the last three years and tracks the NIFTY Small Cap Total Return Index. In contrast, this fund has  3-year annualised returns of 43.03%.

3. Nippon India Small Cap Fund

A Equity scheme launched by Nippon Mutual Fund and managed by Mr. Sameer Rachh. The fund tracks the NIFTY’s Small cap 250 Total Return Index & has a category returns of 29.32% p.a. in last three years. Whereas, this fund has given a 3Y annualised returns of 38.09%.

4. SBI Small Cap Fund 

A Equity Scheme was launched by SBI Mutual Fund and managed by Mr. R Srinivasan. This fund has a category average return of 29.18% p.a. over the last three years and tracks the NIFTY Small Cap Total Return Index. In contrast, this fund has 3-year annualised return of 33.16%.

5. Tata Small Cap Fund

A Equity Scheme launched by Tata Mutual Fund and managed by Mr. Chandraprakash Padiyar. The fund tracks the NIFTY’s Small Cap 250 Total Return Index & has a category average return of 29.18% p.a. in last three years. Whereas, this fund has given a 3Y annualised return of 35.22%.

Now let’s dive a little deeper to understand the ideas behind these top Small Cap Mutual Funds. Here, we'll examine what they are, how they can help you build your portfolio, and whether they're the best option for you;

More about Small Cap Mutual Funds?

We know this funds hold companies with a market capitalization of less than ₹5,000 Crores and hence they are termed as Small Cap Companies. In technical terms, a small cap mutual fund must contain at least 65% of small cap companies. As this have growing potential over the long run but they do carry risk and volatility compared to other equity oriented mutual funds. 

Hence, these Funds have been a popular option for investors because of their remarkable results over the previous years. Since Small Cap Funds are low priced, they allow you to benefit from any future upward movement, or from the expansion of their companies when selected wisely!

Should you invest in Small Cap Funds?

You can consider investing in Small Cap Funds if you’re willing to take some risks & multiply your wealth! As the underlying companies are new and want to grow quickly, they are more volatile than large & mid-sized companies. Hence, Small Cap Funds are best suited for moderate to aggressive investors who want to make the most of the market opportunities.

How do you pick the best Small-cap fund for yourself?

Like any other Mutual Fund, it is essential to consider all the variables that affect Fund’s performance when selecting the Best Small Cap Fund. This section will highlight some of the important factors that you should consider before investing;

1. Investment objective: If you want to get the most of your small-cap investments, you should invest in these for a long-term investment objective. For instance - paying your child’s higher education fee, setting aside funds for retirement, or purchasing a house.

2. Risks: One of the most important factor you should consider before investing is to evaluate whether you wish to play safe or are willing to take some risk. Also, if you have a high risk tolerance or moderate risk appetite you should invest in these funds. 

3. Returns: These funds can provide you with great returns, making them a great addition to your portfolio. With a sizeable degree of risk, these funds act as a portfolio buffer that give excellent value if things turn out well in the market.

4. Cost: Small-cap equity funds charge a fee in order to properly manage your investment. This is referred to as a fund's expense ratio. According to SEBI's criteria, a fund's expenditure ratio cannot exceed 2.50%.