Multicap Funds News Today

Six mutual fund NFOs or new fund offers will open for subscription this week. Should you invest in these NFOs to maximise the return of your portfolio?

The asset allocation of the scheme can be a minimum of 75% and a maximum of 100% in equity and equity related securities of which large, mid, and small caps can account for a minimum of 25% exposure and a maximum of 50%.

DSP Mutual Fund announced the launch of the DSP Multicap Fund. The scheme opened for public subscription on January 08, 2024, and will close on January 22, 2024.

"The recent rally in the market has led to strong inflows into midcap and smallcap funds. However, the valuation gap between largecap and midcap/smallcap stocks has narrowed. Investors looking to invest in midcap and smallcap funds should have a longer term view and manage their return expectations accordingly. Multicap funds, with balanced exposure across market caps, have the potential to deliver good risk-adjusted returns."

Multi-asset or multicap funds are funds that invest across the investment landscape and may include stocks, bonds, and cash. These funds are suitable for those who have a low-risk appetite but want to earn steady returns on their investments.

"Consumer discretionary is a long-term structural theme with the availability of many diverse sets of niche businesses. Indias per capita income is less than $2500, which is very low compared to many other countries, but it is expected to grow rapidly over this decade. With rising per capita incomes, discretionary consumption grows meaningfully."

Large cap stocks are present in several mutual fund categories. While large cap funds have a minimum allocation of 80% to large cap stocks ranked 1-100 by market capitalisation, multi cap schemes need to have a minimum allocation of 25% to large caps.

Electrum Portfolio Managers midcap and smallcap portfolio, Electrum Laureate, gave the highest monthly returns of nearly 12% in August. In just 6 months, it has given a staggering 43% returns.

In the last three months, multi-cap funds have seen net investments of Rs 3,340 crore while flexi-cap funds saw net selling of Rs 1,317 crore. Both work under the same mandate of investing across market capitalisations, albeit to different degrees. So, what’s behind the difference in their fortunes? Rushabh Desai, Founder, Rupee With Rushabh Investment Services explains what’s behind the contrasting investment trend in these two fund categories, which fund is better suited to manage market v...

"Even at the current levels and based on expected EPS growth, we believe that the Indian market is fairly valued. We are comfortable with valuations from a long-term horizon perspective. We believe that in the absence of any major global events, Indian companies will deliver strongly on growth along with improving profitability, justifying the valuation at which the benchmarks are trading."