New Delhi: In April-June 2024 quarter, the Average Assets Under Management (AAUM) of the Indian Mutual Fund industry surged to an impressive Rs 58.96 lakh crore. This milestone underscores the substantial growth and increasing popularity of mutual funds in the country. Mutual funds are categorised into large-cap, mid-cap, and small-cap based on the market capitalization of the companies they invest in.
How to choose Mutual Funds to invest in
Choosing between large, mid, and small-cap funds depends on individual risk tolerance, investment goals, and timeframe. Large-cap funds offer stability, mid-cap funds provide a balance of risk and growth potential, while small-cap funds present higher return potential coupled with higher risk. Investors should carefully consider these factors to align their mutual fund investments with their financial objectives.
Market expert and economist, Dr (CA) Sharad Kohli suggested buyers some mutual funds which to invest in:
Large cap funds to invest in
HDFC TOP 100 Fund
Nippon India large cap fund (Direct Plan)
Nippon India ETF NIFTY NEXT 50 FUND
ICICI Prudential Nifty next 50 fund
LIC Nifty next 50 fund
Small Cap funds to invest in
Tata Small cap fund
Nippon India Small cap fund
Bank of India Small cap fund
Franklin India Smaller company direct fund growth
HSBC Small Cap fund
What are Large-cap Mutual Funds?
Large-cap funds prioritise stability and lower risk, making them suitable for conservative investors. These funds invest in well-established companies with market capitalisations typically exceeding Rs 20,000 Crore, such as Reliance, SBI, and ITC. These companies are leaders in their industries and have a strong market presence.
What are Mid-cap funds?
Mid-cap funds strike a balance between growth potential and risk. They invest in companies with market capitalizations ranging from Rs. 5,000 crores to Rs. 20,000 crores, generally ranking from 101st to 250th in size. Examples include Godrej Industries and Voltas. Mid-cap companies offer potential for higher returns than large-caps but carry higher risk due to their smaller size and growth stage.
What are Small-cap funds?
Small-cap funds target companies with market capitalisations below Rs 5,000 crores, ranked beyond the top 250 companies. These funds are known for their potential to deliver significant returns, driven by their agility and growth prospects. However, they also come with the highest level of risk among the three categories due to their smaller size and susceptibility to market volatility.
(Disclaimer: This article is only meant to provide information. News9live.com does not recommend buying or selling shares or subscriptions of any IPO and Mutual Funds.)
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Mutual Fund investment of your choice: Choosing between large, mid, and small-cap funds depends on individual risk tolerance, investment goals, and timeframe. Investors should carefully consider these factors to align their mutual fund investments with their financial objectives. Personal Finance Business News – Personal Finance News, Share Market News, BSE/NSE News, Stock Exchange News Today
