Quant Small Cap Fund Has Given 52% Annualized Returns In 3-Years, Should You Start SIPs?

The Quant Small Cap Fund, Direct, Plan Growth has returned a whopping 52% to investors in the last three-years. That is not total returns, but, annualized returns. However, that is fantastic by any stretch of imagination.

Returns of Quant Small Cap Fund

For investors looking to start an SIP, there are a few things that you should note. The first is the fund has a good rating from across, including the likes of Groww, which has rated it 5-star and Crisil, which has rated it No 1. Both have accorded the fund a 5-star rating. For investors, the thing they must always keep in mind when investing in mutual funds is that past track record is no indication of future performance. If one is expecting such spectacular returns even in the future, it maybe a little far-fetched. With the Sensex at 61,000 points it is good to temper your expectations. The 1-year returns from the fund has been 7.43%.

Other details of Quant Small Cap Fund before you decide on starting an SIP

The minimum SIP that you can begin with Quant Small Cap Fund is Rs 1,000. This is affordable and investors can look at higher sums as well. The fund has holdings in ITC, Ambuja Cements, HFCL, RBL Bank, India Cements etc. The fund has 95.9% invested in equities and the rest in cash and cash equivalents. The maximum exposure is to consumer staples followed by construction. Apart from SIPs, one can also look at investing in lumpsum, though that is full of risk, given that the Sensex is at 61,000 points. It is hence advisable to go with SIPs as your risks are substantially reduced in markets that are stretched. There is an exit load of 1%, if you redeem the units before a 1-year period.

Investor in SIPs only for Quant Small cap Fund

Small cap mutual funds are extremely risky and hence the best way is SIPs. In fact, if you are looking for lumpsum, it is advisable to wait as we believe that a significant drop for the markets from these levels would provide an opportunity to invest in lumpsum. Also, the ideal way to go about investing would be to look at a period of 3-5 years to generate good returns. In the midst if you generate very good returns, it could be an opportunity to book profits and move to debt, given that interest rates are headed higher.