Investing in Multi Cap Funds is a Lot like Cricket – Here is How?

There are just two things that most Indians love - cricket and investing. And if you think about it, multi cap funds are quite similar to cricket.

Before we get into the similarities, let's understand the basics of a multi cap fund.

A multi cap fund is a type of fund that invests at least 25% of its capital each in small-cap stocks, mid-cap stocks, and large-cap stocks. Also, at least 75% of the capital needs to be invested in equities. Multi-Cap funds come with several benefits like diversification, growth potential, and being beginner-friendly.

So, what do multi cap funds have to do with the game of cricket?

Multi Cap Funds Perform Like a Cricket Team

A good cricket team needs different kinds of players.

We need reliable openers, the safe hands of a wicketkeeper, the deftness of the spinners, the power of hard hitters, and the pace of the fast bowlers.

This ensures that a cricket team has the right person for every job regardless of the situation. When the ball is new, the pacers can step in. When a few wickets are down, the tail-end batsmen can step in. This way, each person in a cricket team has a given role. Every member needs to rise to the occasion when the opportunity presents.

That's roughly the concept of a multi cap fund as well.
A multi cap fund is a mix of large cap, mid cap stocks, and small caps stocks with guaranteed exposure to all market caps.

But why should an investor invest in all of these?

Well, large cap stocks are companies that are well-established and tend to be less volatile, mid cap stocks are companies in the growth phase, and small cap stocks are companies with higher growth potential. These stocks play a varied and essential role in one's equity portfolio.

Further, different market segments may outperform others at different times. A multi cap fund positions the investments to gain from this potential outperformance.

Essentially, a multi cap fund provides diversified exposure to a variety of stocks that serve different purposes. Just like how a cricket team has different kinds of players for different roles.

Wrapping Up

A multi cap fund can be a smart choice for investors looking to gain exposure in companies under all three market cap. It can provide diversification in terms of company size. Overall, the multi cap fund is suitable for those looking for exposure to different segments.

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.

Investors are requested to consult their financial, tax and other advisors before taking any investment decision(s).

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.

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. No representation or warranty is made as to the accuracy, completeness or fairness of the information and opinions contained herein. The AMC reserves the right to make modifications and alterations to this statement as may be required from time to time.

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