The Small-Cap Surge in Multi-Cap Strategies
Multi-cap funds are experiencing a significant shift, with fund managers increasingly tilting their portfolios toward small-cap stocks. What was once considered a balanced approach is now becoming more aggressive as managers chase higher growth potential in India's dynamic market.
40%
Average Small-Cap
35%
Higher Returns
While SEBI mandates only 25% minimum allocation to small-caps in multi-cap funds, many fund managers are voluntarily increasing this exposure to 40-60%, betting on the growth potential of smaller companies in India's expanding economy.
Current Small-Cap Exposure Trends in Major Funds
The shift toward higher small-cap allocation is evident across several leading multi-cap funds. Here's what the data shows:
DSP Multi Cap
Most aggressiveSBI Multi Cap
Balanced aggressiveWhiteOak Capital
Strategic tiltCategory Average
Up from 35%This trend shows that fund managers are willing to take higher risks for potentially higher returns, especially in a growing economy like India's.
Strategic Approach for Investors
For Different Investor Profiles:
Aggressive
Age: 25-40
Allocation: 40-60% small-cap
Horizon: 7+ years
Moderate
Age: 40-55
Allocation: 30-40% small-cap
Horizon: 5+ years
Conservative
Age: 55+
Allocation: 25-30% small-cap
Horizon: 3+ years
