Small cap funds have been on a roll with the stock markets hitting new record highs almost everyday. Those who have stayed invested in SIPs have reaped a bountiful. In fact, across categories we are seeing solid gains from equity mutual funds. Here are 4 small cap equity funds to consider for SIP.
Axis Small Cap Fund
This fund has had stellar returns of 18 per cent in the last 1 year and 13.37 per cent on an annualized basis over a 5-year period. The fund has been rated 5-star by Crisil and 4-star by Value Research. The minimum investment required to start an SIP is Rs 5,000 initially and Rs 500 thereafter.
A Rs 10,000 SIP would have grown to a solid sum of Rs 4.64 over the last 3 years. Since this is a small cap fund, investors with an appetite for risk, should invest in the fund. It's important to remember that small cap mutual funds are always more volatile, than large cap equity mutual funds.
SBI Small Cap Fund
This fund has a 5-star rating from Value Research. The fund has given a fantastic returns of 14.82 over the last 5 years and 22 per cent returns over the last 5 years. The fund has a very good portfolio with investment in several good small cap stocks including the likes of JK Cements, Elgi Equipments, City Union Bank, Hawkins Cooker etc. To start an SIP one needs to invest a sum of Rs 5,000 initially and a sum of Rs 1,000 thereafter.
SBI Small Cap fund has assets under management of nearly Rs 5,400 crores. For those looking at generating long term returns the SBI Small Cap Fund is a good bet.
Kotak Small Cap Fund
This fund has a 4-star rating from Crisil and Value Research Online. The current NAV under the growth plan is Rs 89.78 and under the dividend plan is Rs 41.17. It's important to remember that dividends are now very much taxable.
The 1-year returns from the fund has been 26 per cent, while the 5-year returns has been 11.14 per cent on an annualized basis.
The returns of the fund since launch has been more than 14 per cent on an annualized basis. The fund currently has holdings in Sheela Foam, JK Cement, Century Plyboards, Supreme Industries etc.
Nippon India Small Cap Fund
This fund has a 4-star rating from Crisil. The growth option has an NAV of Rs 45.51, while the dividend option has an NAV of Rs 32.51. Those looking at a long term investment, this is a good bet. Over the last 5 years the annualized returns has been more than 11 per cent.
The fund has exposure to stocks like Deepak Nitrite, Navin Flourine, Tube Investments and Alfe.
About the author
Sunil Fernandes has spent 26 years covering business and finance in India and abroad. Sunil has worked with frontline daily newspapers including Hindustan Times, Deccan Herald and Gulf Times. He has also worked with investment magazines like Dalal Street Investment Journal and Oman Economic Review. Sunil's areas of interest include commodities, equities, mutual funds, tax planning and debt instruments.