Best MultiCap Funds To Invest In FY 2018 – 2019
When you put your money in an equity mutual fund, it follows the investment mandate such as investing in large cap stocks or small cap stocks.
BENEFITS OF INVESTING IN MULTICAP FUNDS
- Works well in dynamic market conditions
The market conditions keep changing and in the funds with a specified cap there isn’t much flexibility to take advantage of a particular bull run or avoid a downturn in the specified category of stocks. This is where multi cap funds come in. They can increase allocation in the category which is supposed to do well and decrease in the ones which are not flavour of the market currently. For example in the start of the bull run Large caps do well while in the later stage they reach high valuations and the focus shifts to mid & small caps. Multi cap funds can use these dynamics to their advantage and to rebalance the equity portfolio accordingly
While a given set of conditions may not benefit one part of the multi-cap fund portfolio, it could benefit the other, thereby creating a counter-balance effect that generates long-term results. When the stocks are prowling the small-cap and mid- cap stocks fall harder than large-caps. Multi-cap funds are able to cushion themselves better than funds which are focused only on these vulnerable segments.
Since they have a flexible mandate, it helps them pick winners across market capitalisations. Multi-cap funds provide the investors with the offer to build a diversified portfolio by giving them access to all kinds of equities. Expert fund managers find opportunities of growth across the market and implement the ideas without capital size restrictions.
BEST MULTICAP FUNDS TO INVEST IN
The fund is 23 years old and has given a return of 19.11% since its inception. In the last 10 years it has beaten the benchmark 7 times. Its 5 year returns of 19.92% are above benchmark’s returns by 4.5%. The fund manager does not shy away from paying higher price for the stocks in which there are chances of incremental growth. The fund invests the companies with a good track record and also checks their future strategies and ability to generate wealth on a sustained basis.
This 13 year old fund has given 22.11% return since inception and has beaten the benchmark 9 times in last 10 years. The 5 year returns of the fund are 21.48% which is 6.5% higher than its benchmark (S&P BSE 500). The fund follows value investment strategy and tries to pick stocks with higher growth potential at discounted price. At present the fund is heavy weight in Large Cap stocks with around 82% portfolio invested in them and remaining in Mid caps.
The fund is more than 7.5 years old and has given 17.92% return since inception. It has beaten the benchmark every time in last five years and its three year and five year returns are way ahead of the benchmark returns. The 5 year return of the fund is 26.64% while that of the benchmark (S&P BSE 200) is only 14.62%. The fund has a higher than category exposure in Mid caps (28% vs 14%) and Small cap (12.5% vs 3.5%). The fund manager looks to invest in the stocks going through temporary under performance while avoiding the ones which could go into a long-term downturn.
The flexibility provided by the multi cap funds makes them very attractive, though before investing in them investors should understand that the risks associated with them also keep changing with the change in portfolio. Due to the flexibility available the fund’s performance is dependent on the fund manager’s views too, hence it is advisable to check the fundamentals and long term performance of the fund before investing.
Start Investing in the above mentioned best multicap funds on WealthTrust App.
New to Mutual Funds? Learn more about basics of mutual funds here.