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Multi-Cap Mutual Funds
- Average returns - Dynamic
- Number of funds - (Static)
What is a Multi-Cap Mutual Fund?
A multi-cap fund is an equity mutual fund that invests in small-cap, mid-cap, and large-cap companies. A minimum of 25% of the portfolio is invested across all market caps.
Advantages of Multi-Cap Mutual Fund
Diversification
With investment across market caps, you get a diversified portfolio of some of the top companies in the stock market.
Enhanced return potential
You can benefit from the increased return potential of small and mid-cap stocks while enjoying the stability of large-cap stocks.
Professional fund management
Multi-cap mutual funds are actively managed schemes wherein the fund managers try to mitigate risks and enhance returns.
Explore Multi-Cap Mutual Fund
AUM: 23427(Cr)
Risk: Very High
- MIN. INVESTMENT 500
- 5 YRS RETURNS 33.32%
- Invest (Per Month) ₹10000
- Get (30 Yrs) ₹24,850*
*Projections/estimations is backtested using historical data.
- AUM: 23427(Cr)
- Risk: High
- MIN. INVESTMENT 1000
- 5 YRS RETURNS 33.32%
- Invest (Per Month) ₹15000
- Get (30 Yrs) ₹34,850*
*Projections/estimations is backtested using historical data.
Multi-Cap Mutual Funds Returns Calculator
REGULAR INVESTMENT
SIP
Invest systematically in regular amounts and build a corpus with a disciplined investing habit.
ONE TIME INVESTMENT
Lump sum
Invest once with the facility of lump sum investing and save at your will. Time the market correctly and earn good returns.
Total Amount Invested
₹ 0
after 30 years you will get a return of
₹ 0
Disclaimer: Projections/estimations is backtested using historical data.
Total Amount Invested
₹ 0
after 30 years you will get a return of
₹ 0
Disclaimer: Projections/estimations is backtested using historical data.
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Understanding Multi-Cap Mutual Funds
Table of Contents
What are multi-cap funds?
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Multi-cap mutual funds are diversified equity mutual funds which invest at least 25% of their portfolio in equity securities of companies in each market capitalisation.
What are the features of multi-cap funds?
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Allocation in small, mid and large-cap equity securities
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High risk-return trade-off
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Suitable for investors with a long-term investment horizon
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Invest through SIPs or lump sum
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Earn tax-free returns up to Rs.1 lakh if you stay invested
What is the meaning of market capitalisation?
Market capitalisation means the total value of a company’s shares
The total number of listed shares is considered for calculation
The current market value is taken to calculate the market cap
Formula -
Market capitalisation = total number of outstanding shares X current market value per share
What are the different types of multi-cap mutual funds?
Concentrated on large-cap stocks
These funds primarily invest in large-cap stocks and secondary focus is on small-cap and mid-cap stocks. These are relatively safer as they avoid the volatility of small-cap and mid-cap stocks.
Small Cap/Mid Cap Funds Concentrated Funds
These are funds that focus highly on small-cap or mid-cap stocks and try to make the most of their growth potential. Meanwhile, the large-cap part is only a cushion against volatility.
No Specific Concentrations
These funds pick and choose investments across market capitalisations while focusing only on the potential of these stocks to outperform and provide you with considerable returns.
What should be the investment horizon for multi-cap funds?
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A long-term investment horizon is suitable
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You can invest for 5 years or above for attractive returns
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You also get a tax benefit on staying invested for a longer tenure
What is the tax implication of multi-cap funds?
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Returns up to Rs.1 lakh are tax-free if you stay invested for 12 or more months
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Returns exceeding Rs.1 lakh are taxed at 10%
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For redemption within 12 months, returns are taxed at 15%
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Dividends earned, if any, are taxed at your income tax slab
What are the payout options?
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Dividend option
Earn dividends on your investment at regular intervals
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Growth option
Accumulate the returns over the investment tenure and get a lump sum amount on redemption
FAQs On Multi-Cap Mutual Fund
Since multi-cap funds are equity investments, they have the potential to be volatile in the short run. If you plan to invest long-term, the risk decreases significantly.
Multi-cap funds are equity investments that perform better in the long run. It is generally advised to stay invested in them for 5-6 years to reap better benefits.
• First-time Investors: A first-time investment should ideally bring enough of a sense of security and safety along with the shining potential of returns. Multi-cap funds can provide the right balance for your initiation.
• Investors in a dilemma: If you are confused as to the market capitalisation you should invest in, multi-cap funds are your go-to, as they will provide you with a balanced, all-round experience across market caps.
• Investors with a long-term investment horizon: If you stay invested for 5+ years in multi-cap funds, the benefits of compounding could serve you well. If this horizon aligns with your financial goals, multi-cap funds are for you.
• Investors seeking mid and small-cap exposure without taking too much risk: With any kind of concentration, multi-cap funds offer you a minimum cushion of large-cap funds
against the volatility of mid-cap and small-cap funds
.
Multi-cap funds maintain a diverse mix, including small-cap, mid-cap, and large-cap companies. Flexi-cap funds, on the other hand, are known as open-ended, dynamic equity funds without any market capitalisation mandate.
Like all equity investments, the suitability of both these funds is subjective. Multi-cap funds with greater mid-cap and small-cap components suit investors with an investment horizon of 5-7 years and high-risk appetite. Meanwhile, flexi-cap funds focusing on large-caps suit investors with a similar horizon but a lower risk appetite due to lower market volatility risk.
You can invest in multi-cap funds either through SIP (Systematic Investment Plan) or a lumpsum amount or a lumpsum amount. You can start your SIP at as low as ₹100. However, please confirm the specific minimum investment limit with your fund house.
Types of Equity Mutual Funds
Funds Based On Market Capitalisation
Funds Based On Investment Style
Other Asset Class Funds
ETF Funds
Invest in funds listed and traded on the stock exchange
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Fund of Funds
Mutual funds that invest in other mutual funds both in India and globally
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Hybrid Funds
Get a mix of equity, debt and other asset classes for a diversified portfolio
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Index Fund
Passively-managed mutual funds tracking a particular index
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