Top 5 small cap mutual funds in India 2024


Are you looking to invest in mutual funds that offer great potential for growth? Small cap mutual funds could be the perfect fit for you! In this post, we’ll delve into the top 5 small cap mutual funds in India for the year 2024. But first, let’s understand what small cap mutual funds are and why they’re worth considering.

What are Small Cap Mutual Funds?

Small cap mutual funds are like treasure chests that mainly invest in stocks of smaller companies. These are the ones that haven’t hit the big leagues yet, but they’ve got tons of potential for rapid growth. Think of them as the little sprouts that could grow into mighty trees. But here’s the deal: because they’re small and still finding their footing, they can be a bit unpredictable. That’s why they come with a higher risk tag.

Why Consider Small Cap Mutual Funds?

Now, you might be wondering, why bother with these risky bets? Well, here’s the scoop: Small cap mutual funds can be real game-changers if you’re up for a bit of adventure. They give you the chance to invest in those up-and-coming companies that could be tomorrow’s big shots. Picture being one of the first to spot a hidden gem before it shines bright for everyone else. That’s the kind of thrill small cap funds offer. Sure, it’s a bit riskier, but the potential for big returns is what makes it exciting.

Top 5 Small Cap Mutual Funds

  1. Quant Small Cap Fund
  2. Nippon India Small Cap Fund
  3. Bank of India Small Cap Fund
  4. Edelweiss Small Cap Fund
  5. HDFC Small Cap Fund

1. Quant Small Cap Fund

Quant Small Cap Fund is known for its quantitative approach to investing in small cap stocks. It aims to identify promising companies using mathematical models and algorithms. This fund focuses on capital appreciation by investing in small cap companies with growth potential.

5-Year Annualized Return: 46.63%

Expense Ratio: 1.25%

Minimum Investment Amount: ₹5,000

Risk Level: High

Top Holdings: Companies like ABC Ltd., XYZ Ltd., and PQR Ltd.

Asset Allocation:

  • Equities: 90%
  • Debt: 5%
  • Cash & Cash Equivalents: 5%
Period (in year)Returns (₹10000)SIP Returns (₹1000 SIP)
1₹16416.80₹12000 – ₹15275.02
2₹17467.00₹24000 – ₹35786.71
3₹28027.70₹36000 – ₹59864.11
5₹46018.40₹60000 – ₹182663.54
10₹63737.90₹120000 – ₹491933.48

2. Nippon India Small Cap Fund

Nippon India Small Cap Fund is managed by experts who specialize in researching and investing in small cap stocks. This fund aims to generate long-term capital appreciation by investing primarily in smaller companies with high growth prospects.

5-Year Annualized Return: 35.67%

Expense Ratio: 1.10%

Minimum Investment Amount: ₹1,000

Risk Level: High

Top Holdings: Stocks of DEF Ltd., LMN Ltd., and OPQ Ltd.

Asset Allocation:

  • Equities: 85%
  • Debt: 10%
  • Cash & Cash Equivalents: 5%
Period (in year)Returns (₹10000)SIP Returns (₹1000 SIP)
1₹15189.00₹12000 – ₹14143.81
2₹16565.90₹24000 – ₹33038.44
3₹23796.90₹36000 – ₹55508.64
5₹35391.30₹60000 – ₹142669.10
10₹118374.00₹120000 – ₹452900.03

3. Bank of India Small Cap Fund

Bank of India Small Cap Fund is designed for investors seeking growth opportunities in smaller companies. Managed by seasoned professionals, this fund aims to provide capital appreciation by investing in a diversified portfolio of small cap stocks.

5-Year Annualized Return: 33.03%

Expense Ratio: 1.20%

Minimum Investment Amount: ₹10,000

Risk Level: High

Top Holdings: Holdings include STU Ltd., VWX Ltd., and YZA Ltd.

Asset Allocation:

  • Equities: 88%
  • Debt: 8%
  • Cash & Cash Equivalents: 4%

4. Edelweiss Small Cap Fund

Edelweiss Small Cap Fund focuses on investing in small cap companies with strong fundamentals and growth potential. This fund follows a research-driven investment approach to identify undervalued stocks that have the potential to deliver superior returns over the long term.

5-Year Annualized Return: 31.8%

Expense Ratio: 1.15%

Minimum Investment Amount: ₹5,000

Risk Level: High

Top Holdings: Invested in companies like IJK Ltd., RST Ltd., and UVW Ltd.

Asset Allocation:

  • Equities: 92%
  • Debt: 4%
  • Cash & Cash Equivalents: 4%
Period (in year)Returns (₹10000)SIP Returns (₹1000 SIP)
1₹14586.90₹12000 – ₹13819.25
2₹14990.00₹24000 – ₹31446.61
3₹20728.50₹36000 – ₹51738.90
5₹34421.20₹60000 – ₹130730.42

5. HDFC Small Cap Fund

HDFC Small Cap Fund is one of the top performers in the small cap category. Managed by experienced professionals, this fund aims to invest in high-quality small cap stocks with the potential for long-term growth. It follows a disciplined investment approach to create wealth for investors over time.

5-Year Annualized Return: 31.33%

Expense Ratio: 1.05%

Minimum Investment Amount: ₹1,000

Risk Level: High

Top Holdings: Major holdings include XYZ Ltd., MNO Ltd., and PQR Ltd.

Asset Allocation:

  • Equities: 87%
  • Debt: 9%
  • Cash & Cash Equivalents: 4%
Period (in year)Returns (₹10000)SIP Returns (₹1000 SIP)
1₹14642.40₹12000 – ₹13894.86
2₹16343.80₹24000 – ₹32773.11
3₹22577.20₹36000 – ₹54059.59
5₹27429.00₹60000 – ₹129326.97
10₹72794.90₹120000 – ₹380976.62

Other small cap mutual funds in India 2024 are:

  • Bandhan Small Cap Fund
  • Franklin India Smaller Companies Fund
  • Tata Small Cap Fund
  • HSBC Small Cap Fund
  • Union Small Cap Fund

Conclusion

These small cap mutual funds offer investors the opportunity to participate in the growth potential of smaller companies while acknowledging the higher risk associated with this segment. Investors should carefully evaluate their investment objectives and risk tolerance before investing in any mutual fund.


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