Diversify Your Portfolio with Multicap Funds

For first-timers, investing could be overwhelming and even nerve-wrecking with the number of options available. Some may be confused where to invest, while others may want it all. Investing in funds suitable to your profile has the potential to help build long term wealth. But making the right choice is the key. Finding an investment that is versatile, comprehensive, diversified and inclusive is important. Multi Cap Funds offer a simple yet powerful way to potentially grow your money.

Let's take a closer look at what Multi Cap Funds are and how they can form an integral part of your portfolio:

What are Multi Cap Funds?

Multi Cap funds are a diversified investment option, that is not limited to a single scheme but has elements of everything. About 75% of Multi Cap Funds are mandatory to be invested in equity and equity-related instruments. Simply put, Multi Cap allows at least 25% of your investment value each in small-cap, mid-cap and large-cap stocks.

An investment option for all

The Multi Cap Funds lies in their inclusivity - they're for everyone entering into the world of equities! For the worried investor, multicap funds can offer a comprehensive solution for those concerned about missing out on market opportunities, as they invest across all market capitalization segments. For a confused investor, multicap funds can help alleviate investor uncertainty by strategically allocating investments across various market caps, providing a well-diversified portfolio. And if you're ambitious for growth, the smaller companies in the mix can offer potential growth opportunities. By diversifying investments across different market segments, these funds cater to varying risk appetites.

Adapting to Market Dynamics

One of the significant advantages of Multi Cap Funds is that they have higher exposure due to the composition of all market caps. This enables investors to navigate through dynamic market conditions with resilience and safeguard investment during volatility.

For instance, in certain market cycles, midcap and small-caps may outperform, and conversely, during consolidation and expensive valuation of smaller stocks, the large-cap stocks holding may provide potential stability to the portfolio.

Source: MFIE
Data as of Dec 31, 2023

Participating in India's Growth Story:

India's economy is undergoing a rapid progress, supported by robust GDP growth and a thriving business landscape. Surpassing the significant milestone of $5 trillioni equity market capitalisation, India presents abundant opportunities for companies across the entire market spectrum to thrive. Strategic investments in key sectors like infrastructure, manufacturing, and technology highlight a proactive approach in driving sustainable progress.

This favourable market environment not only enhances the appeal of Multi Cap Funds for investors but also reflects India's commitment to fostering long-term growth.

Multi Cap Funds provide a convenient entry point into a market where small-cap companies may mature into mid-cap contenders and eventually grow to large-caps, allowing investors to capitalize on this upward trajectory effectively.

India's economy has been resilient supported by robust GDP growth and a thriving business landscape. Surpassing the $5 trillion milestone in the equity market, only strengthens faith in the country. India offers abundant opportunities for companies across the entire market spectrum to thrive. This favourable market environment not only enhances the appeal of Multi Cap Funds for investors but also reflects India's commitment to fostering long-term growth.

Risk-Adjusted Returns:

Multicap funds aim to balance between risk and reward by investing across large, mid, and small-cap companies, they offer diversification that can help mitigate risk compared to a fund focused on a single market segment. This diversification also allows them to potentially capture growth opportunities across the entire market capitalization spectrum. As a result, multi cap funds have the potential to deliver relatively better risk-adjusted returns.

Overall, Multi Cap Funds are like all-in-one investment avenue for investors.

https://www.amfiindia.com/investor-corner/knowledge-center/SEBI-categorization-of-mutual-fund-schemes.html
https://www.moneycontrol.com/news/business/earnings/mcap-of-bse-listed-companies-hits-5-trillion-first-time-12727894.html .

Source: Axis MF Research, AMFI, MFIE
Data as on August 31, 2024

This is an investor education and awareness initiative by Axis Mutual Fund.

Investors have to complete one-time KYC process.

Visit www.axismf.com or contact us on [email protected] for more information. Investors should deal only with Registered MFs, details of which are available on www.sebi.gov.in - Intermediaries/ Market Infrastructure Institutions section.

For any grievance redressal, investors can call us on 1800 221 322 or write us at [email protected] or register complaint on SEBI Scores portal at http://scores.gov.in.

Market caps are defined as per SEBI regulations as below: a. Large Cap: 1st -100th company in terms of full market capitalization. b. Mid Cap: 101st -250th company in terms of full market capitalization. c. Small Cap: 251st company onwards in terms of full market capitalization.

Sector(s) mentioned above are for general purposes and should not be construed as recommendation.

Statutory Details: Axis Mutual Fund has been established as a Trust under the Indian Trusts Act, 1882, sponsored by Axis Bank Ltd. (liability restricted to Rs. 1 Lakh). Trustee: Axis Mutual Fund Trustee Ltd. Investment Manager: Axis Asset Management Co. Ltd. (the AMC). Risk Factors: Axis Bank Limited is not liable or responsible for any loss or shortfall resulting from the operation of the scheme.

Mutual Fund Investments are subject to market risks, read all scheme related documents carefully.