Multi-cap funds are diversified equity funds that invest in varying proportions in stocks of companies across market capitalization to optimize return on investment.
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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Mid-cap mutual funds aim at generating returns which beat the benchmark when the markets play well. They are much riskier than large-cap mutual funds due to high volatility.
Mid-cap mutual funds, as the names suggest, invest in stocks of the mid-sized companies or stocks with medium market capitalisations. In this context, the word ‘cap’ refers to the market capitalisation or size of the listed company. For mid-cap, the market capitalisation ranges between Rs 500 crore to Rs 10,000 crore. A company’s size is an essential criterion while selecting equity portfolios because depending on the size of the company, the portfolio would have its unique set of opportunities and risks.
Since these funds are invested in mid-cap companies, during a bull run, they deliver stupendous returns, sometimes even outperforming large-cap funds or diversified equity 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 Mid-Cap Mutual Funds?
Investors who are looking for faster growth and have an appetite for a high-risk can invest in mid-cap funds. Mid-sized companies provide faster earnings and steep growth while being volatile on the stock index. Investors who are ready to face volatility of these stocks in expectations of fascinating returns can invest in these funds.
3. Advantages of Mid-Cap Mutual Funds
Mid-cap funds have generally outperformed large-cap funds. The very nature of the mid-cap funds makes the trend to continue for quite some time.
The mid-cap funds are relatively underfollowed in stock markets as compared to large-cap funds. This provides investors with an excellent opportunity to seek fast growth in their investments using these funds.
4. Things an Investor Should Consider
Though mid-cap funds perform very well in bull runs, their value takes quite a beating when the market sentiment is dropping. Also, in the case of high-quality stocks, mid-cap funds are not appropriate since they have a higher risk factor involved. Mid-cap stocks suffer from liquidity constraints due to their smaller capital base i.e. the number of shares offered by the company.
Since the underlying shares are characterised by lower market capitalisation and limited liquidity, these funds tend to follow cycles of boom and dip. This is based on the mirroring of the stock indices in general. The performance of mid-cap funds is mentioned below for the year 2017.
Large-cap mutual funds are those that invest predominantly in companies having a large market capitalisation. These are popular for their consistent returns over some time. The companies of large-cap funds are generally leaders in their field of business and hence, tend to remain more stable than smaller or mid-cap companies at times when markets are volatile. The large-cap companies generally have a good track record in the market backed by healthy corporate governance practices.
2. Who Should Invest in Best Large-Cap Mutual Funds?
Individuals make investments based on their requirements, goals, and risk profile. The large-cap mutual funds are apt for those who want to earn higher returns with little to no risk of market fluctuations. These funds are suitable for those investors who are less aggressive in their investment strategy and don’t wish to invest in risky mid-cap and small-cap mutual funds mutual funds.
Investing in large-cap mutual funds is a good option for the first-time investor. The underlying companies have a history of consistent performance during the highs and lows of the market. Investors must understand that these funds may not pose very high returns even at the hour of favourable market conditions. But keep in mind that the returns from large-cap funds will be less volatile.
Top 10 Best Large-Cap Mutual Funds
Based on large-cap fund performance indicator values, following are the best large-cap mutual funds. The rankings done here are for a consolidated list of large-cap equity funds on a 3-year return basis.
Top large-cap funds
5-year returns
Axis Bluechip Fund – GrowthLarge-Cap Fund
12.31%
Mirae Asset Large Cap Fund – Regular – GrowthLarge-Cap Fund
11.90%
Reliance Large Cap Fund – GrowthLarge-Cap Fund
10.77%
HDFC Top 100 Fund – GrowthLarge-Cap Fund
10.61%
ICICI Prudential Bluechip Fund – Institutional Option I – GrowthLarge-Cap Fund
10.42%
Mutual funds are subject to market risk and require informed decision making. Reach out to our team of financial experts at Mob- 9891423442 to gain further guidance on investing. More visit to agindiaonline.com https://youtube.com/c/Aginvestment
DSP TAX SAVER ICICI PRU LONG TERM EQUITY AXIS LONG TERM EQUITY SBI MAGNUM TAX GAIN HDFC TAX SAVER RELIANCE TAX SAVER FRANKLIN INDIA TAX SHIELD L&T TAX ADVANTAGE
The ELSS category is very competitive. It comprises a motley mix of funds with strong and established strategies. Funds that fall under this category are diversified equity funds with no restriction on the market cap. So they could be multi cap or large cap or mid cap oriented. Equity Linked Savings Schemes, or ELSS, fall under Section 80C of the Income Tax Act. Investments made here are eligible for a deduction up to Rs 1,50,000.
DSP Tax Saver Date of Analysis: March 2019 Analyst Rating: Neutral Fund Manager: Rohit Singhania The fund’s gestation period will be longer in a more competitive category with strong and established strategies. There have been significant changes within the investment team as well as at the fund-house level. In May 2018, BlackRock and DSP parted ways from their decade-old joint venture. The equity investment team also witnessed significant turnover, with some of its key managers– S. Naganath (CIO), Anup Maheshwari (CIO of equities after Naganath), and Harish Zaveri– exiting the fund company between 2017 and 2018, which is a cause for concern. The fund’s strategy, however, has stayed consistent under Singhania. He runs it in line with its investment mandate, which allows him to adopt a fluid investment approach without any bias or restrictions in terms of stocks or sectors. In the manager’s own words, this fund doesn’t have a defined investment approach, which in turn provides him the liberty to capitalise on any investment opportunity that he sees in the market, provided it makes a grade on his selection parameters.
Consequently, the fund’s portfolio turnover tends to be on the higher side.
While an unconstrained process can be very rewarding, it is risky, too. A wrong bet can lead to significant under performance. Also, the absence of a rigidly defined method means investments are made on a somewhat intuitive basis. Hence, it must be noted that the success of the investment process largely depends on Singhania’s execution skills.
We believe that the fund is yet to make a cut for itself within the category and needs more time before it could qualify for an upgrade.
ICICI Prudential Long Term Equity Date of Analysis: November 2018 Analyst Rating: Neutral Fund Manager: Sankaran Naren, Harish Bihani
There has been another change in manager in this fund. After taking over its mantle in October 2015, George Herber Joseph has relinquished the fund’s management responsibility effective November 5, 2018.
This fund has passed through multiple hands in the past few years. CIO Sankaran Naren (October 2005 till February 2011), Munzal Shah (March 2011 till May 2011), and Chintan Haria (June 2011 till September 2015) have managed this fund earlier. George Herber Joseph started comanaging this fund along with Haria from April 2015 and took over as the lead manager in October 2015. He comes from ICICI’s portfolio-management-services division.
The following report was based on our opinion on Joseph and his investment style.
Pleasingly, and despite the changes, the investment strategy largely stays the same. However, within the defined framework, Joseph has realigned the portfolio since taking over the fund in line with his investment thesis and understanding of macroeconomic scenarios. Joseph plies a free-flowing multi-cap strategy and follows a benchmark-agnostic approach for constructing the portfolio. He is fairly valuation-conscious and stays away from expensive stocks/sectors. He scouts for companies having good management with strong long-term track records, good free cash flow generating capabilities, and strong balance sheets. While investing, Joseph prefers staying away from investing in highly leveraged stocks.
Admittedly, the fund hasn’t done badly despite the changes at the helm, with the year 2017 being an exception. This year, the fund underperformed substantially as the manager’s valuation-conscious investment approach and strategy of taking contra bets has been out of favour, which dragged its overall performance under Joseph’s stewardship down with regard to benchmark index and category peers. However, these are still early days for Joseph at the helm here. We would like to evaluate his ability in executing the process over a market cycle to build conviction.
Today in Investment market every one is coming with Online Transaction Platform, Like- PayTm, Grow, ETmoney, Every AMC with online app/portal.
So it very important to know which platform and why, you have to choose
MFU- Mutual Fund Utility
MF Utilities India Pvt Ltd (MFUI) is the Mutual Fund Industry’s “Shared Services” initiative formed by the Asset Management Companies (AMCs) of SEBI registered Mutual Funds under the aegis of AMFI, with an objective of investor empowerment, distributor / RIA convenience, consolidation of information to various agencies, operational efficiency for RTAs and benefits to AMCs, thereby benefitting all stakeholders in the industry. The prime objective of MFUI is to consolidate all “Transaction Requests” received by the industry from multiple sources and transmit it to the “Fulfiller” of the request (Transfer Agent), thereby bringing in operational efficiency by reducing multiplicity and duplication of activities. Towards achieving this objective, MFUI has developed the Portal, MF Utility (MFU), which operates as a “Transaction Aggregating System” for transactions in Mutual Funds.
MF Utility (MFU) is an innovative initiative of the Indian Mutual Fund Industry that brings significant benefits to all stakeholders, i.e. Investors, Distributors, RIAs and Asset Management Companies, by leveraging technology, MFU will bring many conveniences to the investors and distributors /RIAs and allow Mutual Funds to significantly enhance their reach and presence in the country to further the goals of retail penetration. MFU will also help remove duplicities in the system and reduce the inherent risks in the industry.
MFUI is equally owned by the AMCs of SEBI registered Mutual Funds in India.
Benefitsof MFU vs Other Platforms
MFU- MF Utility
PrivatePlayer
1- Not Chargeable
Chargeable/Partially Chargeable
2- Life Time Free
Short time free for attract customers
3- Owned by AMC/SEBI
Owned by private company/person
4- Not to be close
May be close at any time
5- View all your portfolio of all AMC
Only view folio of investment from his portal
6- Transact all folio at industries
Very limited option
7- Easy to enroll
Depend on others source etc
Editor View
Therefor my personal recommendation to don’t go with Private Players, As they have personal interest and they may be charged after certain time, which will give you panic situation in between of your investment.
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There are different Types of Mutual Funds for SIP that include equity, debt, balanced and ultra-short term funds.
However, Equity Mutual Funds offer maximum returns when invested via a SIP. Financial advisors suggest that the investors must invest in best mutual funds for SIP basis their investment objectives and the period of SIP investment.
Why Invest in Top Ten SIP Funds?
SIPs give a disciplined approach to investing Systematic investing helps in financing the future dream and major goals like- retirement, child’s career, purchase of a house/car or any other assets SIPs help in making the most of compounding and are ideal for young investors Systematic Investment Plans minimize the risk of equity fluctuations.
I would recommend an asset allocation that apportions 60% of your investment to equity and the remaining 40% to debt.
You can have a portfolio of a blend of equity funds such as Mirae Asset Large Cap fund, Invesco India Growth Opportunities fund, Kotak Standard Multicap fund and Franklin India Smaller Companies fund
