SBI Small Cap Fund vs Other Small Cap Funds: Which is the Best for You?
SBI Small Cap Fund vs Other Small Cap Funds
SBI Small Cap Fund vs Other Small Cap Funds are popular among investors looking for high growth potential. With a focus on small-sized companies, these funds aim to capitalize on the early growth stages of businesses that could become the future market leaders. Among the top choices, SBI Small Cap Fund stands out for its performance, but how does it compare to other leading small-cap mutual funds? Let’s take a closer look.
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What is a Small Cap Fund?
A small-cap fund is a type of equity mutual fund that primarily invests in small-cap companies. According to SEBI (Securities and Exchange Board of India), small-cap companies are those ranked below the top 250 companies based on market capitalization. These funds are known for their high-risk, high-reward nature, making them suitable for investors with a high risk tolerance and a long-term investment horizon.
Overview of SBI Small Cap Fund
SBI Small Cap Fund is one of the most popular small-cap funds in India, managed by SBI Mutual Fund. It focuses on identifying promising small-cap stocks with high growth potential. The fund is known for its robust stock selection process, active fund management, and consistent performance over the years.
Key Features of SBI Small Cap Fund:
Fund Manager: Experienced management team led by R. Srinivasan.Investment Objective: Long-term capital appreciation by investing in high-growth small-cap companies.Minimum Investment: ₹5,000 for lump-sum or ₹500/month via SIP.Exit Load: 1% if redeemed within 1 year.
Comparison of SBI Small Cap Fund with Other Top Small Cap Funds
| Criteria | SBI Small Cap Fund | HDFC Small Cap Fund | Nippon India Small Cap Fund | Axis Small Cap Fund | ICICI Prudential Small Cap Fund |
|---|
| Fund Size (AUM) | ₹21,000 Crore | ₹17,500 Crore | ₹35,000 Crore | ₹15,000 Crore | ₹7,000 Crore |
| Expense Ratio | 1.23% (Direct Plan) | 1.12% (Direct Plan) | 1.29% (Direct Plan) | 0.80% (Direct Plan) | 1.10% (Direct Plan) |
| 1-Year Returns | 25.6% | 20.3% | 24.1% | 18.9% | 21.0% |
| 3-Year Annualized Returns | 28.4% | 26.0% | 29.5% | 27.2% | 25.8% |
| 5-Year Annualized Returns | 23.7% | 21.8% | 25.0% | 22.5% | 20.7% |
| Risk Level | High | High | High | Moderate-High | High |
| Portfolio Diversification | Diversified across sectors | Bias towards mid and small sectors | Consumer, Financials, Chemicals | IT, Consumer Discretionary | Capital Goods, Chemicals, Financials |
| Minimum SIP Investment | ₹500 | ₹500 | ₹100 | ₹500 | ₹1000 |
| Exit Load | 1% (if redeemed within 1 year) | 1% (if redeemed within 1 year) | 1% (if redeemed within 1 year) | 1% (if redeemed within 1 year) | 1% (if redeemed within 1 year) |
Fund Size (AUM)
- Nippon India Small Cap Fund has the largest Asset Under Management (AUM), which might affect its agility in making quick portfolio adjustments.
- SBI Small Cap Fund manages a substantial fund size, indicating strong investor confidence and robust fund performance.
Conclusion
The SBI Small Cap Fund remains a top choice for investors seeking exposure to small-cap companies with the potential for high growth. However, it’s crucial to consider other small-cap funds based on their performance, expense ratio, and risk levels. Diversifying across multiple small-cap funds can also be a strategy to balance risks and returns.
Before making an investment decision, ensure you assess your risk appetite and consult with a financial advisor. Investing in small-cap funds is a long-term strategy, best suited for those who can withstand market volatility and are looking for substantial growth over time.
Best SBI Small Cap Fund for SIP in 2024
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SBI Small Cap Fund Can Boost Your Investment Portfolio
