Small cap funds are a type of mutual fund that are known to give high returns, but are also considered to be riskier than large and mid cap funds.
According to data from the Association of Mutual Funds in India (AMFI), some small cap funds have given less than 6% returns in one year.
In fact, three funds have given returns of less than 6%, with one fund even giving a negative return of -1.66% in one year.
However, there are also some small-cap funds that have given double the returns of fixed deposits in one year.
Currently, fixed deposit interest rates for 1-year tenure in banks are in the range of 5-7.5%, making these small cap funds a potentially lucrative investment.
Let’s take a look at the top 5 small cap funds as per AMFI website data as on May 5, 2023,
which have given returns of over 17% under Direct Plan and over 15% under Regular Plan in one year.
HDFC Small Cap Fund
The Direct Plan of HDFC Small Cap Fund has given a return of 22.41% while the Regular Plan has given a return of 21.21% in one year.
The scheme tracks S&P BSE 250 SmallCap Total Return Index, which has given a return of 8.58% in one year.
Tata Small Cap Fund
The Direct Plan of Tata Small Cap Fund has given a return of 21.34% while the Regular Plan has given a return of 19.05% in one year. The scheme tracks NIFTY SmallCap 250 Total Return Index, which has given a return of 5.01% in one year.
Franklin India Smaller Companies Fund
The Direct Plan of Franklin India Smaller Companies Fund has given a return of 17.54% while the Regular Plan has given a return of 16.57% in one year.
The scheme tracks NIFTY SmallCap 250 Total Return Index, which has given a return of 5.01% in one year.
Nippon India Small Cap Fund
The Direct Plan of Nippon India Small Cap Fund has given a return of 17.20% while the Regular Plan has given a return of 16.15% in one year. The scheme tracks NIFTY SmallCap 250 Total Return Index, which has given a return of 5.01% in one year.
Quant Small Cap Fund
The Direct Plan of Quant Small Cap Fund has given a return of 17.28% while the Regular Plan has given a return of 15.60% in one year.
The scheme tracks NIFTY SmallCap 250 Total Return Index, which has given a return of 5.01% in one year.
Investors looking for high returns may consider investing in these top-performing small cap funds, but should also be aware of the associated risks.
As with any investment, it’s important to do your own research and consult with a financial advisor before making any investment decisions.
