Multi-cap funds are diversified equity funds that invest in varying proportions in stocks of companies across market capitalization to optimize return on investment.

Fund NameNAVNAV Date1 Week1 Month3 Months6 Months1 Year3 Years5 Years10 YearsInce.
Multi Cap
Aditya Birla SunLife – Equity-G686.980011/09/2019130.31-1.05-26.93-5.24-5.245.789.6012.0622.25
SBI – Focused Equity-G137.066911/09/2019113.26-3.71-22.613.510.549.0510.4317.2319.17
DSP – Equity-G38.406011/09/2019112.20-3.56-18.063.891.167.138.1811.6919.02
Motilal Oswal – Multicap 35 Reg-G25.147511/09/2019104.078.75-24.34-1.71-4.467.6013.790.0018.72
HDFC – Equity-G631.320011/09/2019137.111.13-35.59-4.46-1.947.246.6412.3318.27
Franklin India – Equity-G549.428911/09/2019135.12-5.52-32.17-11.61-8.983.427.7612.2817.41
Canara Robeco – Equity Diversified Reg-G127.240011/09/201971.03-12.80-30.70-4.87-1.638.137.3311.5817.23
IDFC – Multi Cap Reg-G88.260011/09/2019120.280.13-24.78-4.91-7.644.047.2414.7116.88
Sahara – Growth-G139.757811/09/2019125.276.36-31.42-4.32-2.063.952.556.8416.74
Quant – Active-G171.337411/09/2019117.18-2.25-30.69-7.51-6.776.829.0410.8816.61

1. What are Best Multi-Cap Mutual Funds?

Best multi-cap mutual funds invest in equity shares of companies of different market capitalisation. Instead of sticking to a particular capitalisation, these funds incorporate large-cap, mid-cap, and small-cap stocks in the portfolio in a specific proportion. As compared to pure mid-cap/small-cap funds, these funds are less risky and prevalent among investors who are less aggressive in terms of returns.

The fund manager is well-positioned to pick stocks across capitalisation and sectors as per his outlook of the market. The investor, thus, may stay free from anxieties regarding chasing the action or missing out on rallies in a particular sphere of the market.

Apart from stock-picking, the fund manager keeps switching holdings in the fund between large-cap, mid-, and small-cap stocks as he/she deems fit, based on market movements. Using the leeway, the fund managers tend to have a large-cap bias and keep on increasing or decreasing their mid-cap holdings by a small margin as and when market conditions change.

Since these funds are invested in multi-cap companies, during a bull run, they deliver stupendous returns, sometimes even outperforming the pure large/mid-cap funds. This happens because, during a bull market, the underlying stocks in the funds are able to unlock their values and tap into the growth opportunities.

2. Who Should Invest in Best Multi-Cap Mutual Funds?

Multi-cap funds sustain an extensively diversified portfolio consisting of stocks of different market capitalisation and sectors. These funds are an excellent way to take exposure to broader equity segment using systematic investment plan (SIP) of as low as Rs 500 to start-off.

Investors who don’t want to get into the trouble of stock-picking or deciding which market capitalisation fund would suit them may go for multi-cap funds as a starter. They may switch to pure cap funds after getting the hang of markets. They are also suited for beginners and novice investors who intend to hedge their risks.

From a risk-return perspective, best multi-cap funds are capable of balancing the risk and volatility very well when it comes to blending the small caps and mid-caps in a single portfolio. At the same time, the investor may expect the stability that they would receive from a large-cap fund. During the market rally, small-caps perform well, and when it is a slump, the well-established companies tend to take hold of erosion of returns. Those who have a moderate risk appetite may think of investing in multi-cap funds.

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