5 Smallcap funds with 3-Year annualised returns of up to 32% to add to your watchlist

Synopsis: Small-cap equity mutual funds invest beyond the top 250 listed companies, suiting long-term investors seeking high returns but accepting higher risks. Listed are the five best performers by 3-year returns.

Small-cap equity Mutual Funds invest in stocks belonging to the small-cap segment, which includes all companies except the largest 250 listed companies ranked by market capitalisation. They are best suited for investors who are willing to invest for a minimum of 3-4 years and are seeking the potential for very high returns. However, such investors must also be prepared for the possibility of experiencing higher levels of losses in their investments.

Following are the top five best-performing small-cap equity mutual funds based on their 3-year annualised returns:

HDFC Small Cap Fund

With assets under management (AUM) of Rs. 36,353 crores, the HDFC Small Cap Fund – Direct Plan – Growth has delivered 3-year annualised returns of around 25 percent and absolute return of around 97 percent. The fund’s net asset value (NAV) of Rs. 158.74, with an expense ratio of 0.71 percent.

The fund has 91.09 percent allocation to domestic equities, comprising 3.06 percent in large-cap stocks, 4.54 percent in mid-cap stocks, and 62.22 percent in small-cap stocks.

Quant Small Cap Fund

With an AuM of Rs. 29,462.7 crores, the Quant Small Cap Fund – Direct Plan – Growth has delivered 3-year annualised returns of around 26 percent and absolute return of around 102 percent. The fund’s net asset value (NAV) of Rs. 271.6, with an expense ratio of 0.66 percent.

The fund’s portfolio comprises 96.38 percent allocation to domestic equities, with 13.32 percent in large-cap stocks, 18.72 percent in mid-cap stocks, and 33.26 percent in small-cap stocks. Additionally, 1.06 percent of the portfolio is invested in debt instruments, entirely in government securities.

Invesco India Smallcap Fund

With an AuM of Rs. 7,580.5 crores, the Invesco India Smallcap Fund – Direct – Growth has delivered 3-year annualised returns of around 28 percent and absolute return of around 109 percent. The fund’s net asset value (NAV) of Rs. 46.06, with an expense ratio of 0.44 percent.

The fund holds 97.56 percent of its portfolio in domestic equities, comprising 3.03 percent in large-cap stocks, 9.97 percent in mid-cap stocks, and 35.33 percent in small-cap stocks.

ITI Small Cap Fund

With an AuM of Rs. 2,679.8 crores, the ITI Small Cap Fund – Direct Plan – Growth has delivered 3-year annualised returns of around 29 percent and absolute return of around 114.5 percent. The fund’s net asset value (NAV) of Rs. 31.2, with an expense ratio of 0.54 percent.

The fund invests 96.47 percent of its portfolio in domestic equities, with 4.36 percent in large-cap stocks, 8.59 percent in mid-cap stocks, and 45.61 percent in small-cap stocks.

Bandhan Small Cap Fund

With an AuM of Rs. 14,062 crores, the Bandhan Small Cap Fund – Direct Plan – Growth has delivered 3-year annualised returns of around 32 percent and absolute return of around 128 percent. The fund’s net asset value (NAV) of Rs. 49.8, with an expense ratio of 0.4 percent.

The fund allocates 87.86 percent of its portfolio to domestic equities, including 5.42 percent in large-cap stocks, 11.96 percent in mid-cap stocks, and 41.53 percent in small-cap stocks.

Written by Shivani Singh

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