Top 10 Small Cap Mutual Funds

Fund NameCategoryRisk1Y ReturnsRatingFund Size(in Cr)
SBI Small Cap FundEquityHigh-13.3%5star2,255
SBI Small Cap FundEquityModerately High-13.3%5star2,255
SBI Small Cap FundEquityModerately High-14.3%5star2,255
SBI Small Cap FundEquityHigh-14.3%5star2,255
HDFC Small Cap FundEquityModerately High-19.0%5star7,894
HDFC Small Cap FundEquityHigh-19.0%5star7,894
Escorts High Yield Equity PlanEquityModerately High-10.8%5star4
Escorts High Yield Equity PlanEquityModerately High-11.3%5star4
Escorts High Yield Equity PlanEquityModerately High-11.3%5star4
HDFC Small Cap FundEquityModerately High-17.9%4star7,894
HDFC Small Cap FundEquityHigh-17.9%4star7,894
Reliance Small Cap FundEquityModerately High-21.8%4star7,542
Reliance Small Cap FundEquityHigh-21.8%4star7,542
Reliance Small Cap FundEquityModerately High-21.8%4star7,542
L&T Emerging Businesses FundEquityHigh-21.9%4star5,611
View All Top 10 Small Cap Mutual Funds

Best Small Cap Mutual Funds

Companies that are ranked after 250 in terms of their market capitalisation are termed as small cap companies. These small cap companies have a market cap which is less than Rs 500 crores and are publicly traded. Mutual fund schemes that invest in these companies are termed as small cap mutual fund. The small cap companies are comparatively newer and have a significantly higher risk when compared with large cap or mid cap companies.

Small cap funds are extremely sensitive to market movements and may yield huge returns during a positive market movement. However, this means that during a negative market sentiment, these funds will lose substantial value.

The small cap mutual funds are extremely risky, and it is imperative for you to be cautious before making an investment in small cap mutual funds. While some of the best performing small cap mutual funds may yield good returns, others may not do equally well.

Let's have a closer look

Now let us jump and check about these top 10 mutual fund schemes.

SBI Small Cap Fund Direct Growth

Fund Performance: This fund has consistently beaten its benchmark in Small Cap segment and provided 11.56% annualized returns in the last 3 years. In the last 1 year, it gave -13.33% returns.

Why to invest: The fund has consistently beaten other funds in same category along with its benchmark and provided -13.33% returns in the last 1 year. . Minimum SIP investment amount for this scheme is ₹500. This is one of the best Equity mutual fund in India.

Launch Date
Min Investment AmtN.A
AUM2,255Cr
1Y Returns-13.3%

SBI Small Cap Fund Direct Dividend

Fund Performance: This fund has consistently beaten its benchmark in Small Cap segment and provided 11.56% annualized returns in the last 3 years. In the last 1 year, it gave -13.33% returns.

Why to invest: The fund has consistently beaten other funds in same category along with its benchmark and provided -13.33% returns in the last 1 year. Minimum lump sum investment amount for this scheme is ₹NaN. Minimum SIP investment amount for this scheme is ₹500. This is one of the best Equity mutual fund in India.

Launch Date
Min Investment AmtNaN
AUM2,255Cr
1Y Returns-13.3%

SBI Small Cap Fund Dividend

Fund Performance: This fund has consistently beaten its benchmark in Small Cap segment and provided 10.31% annualized returns in the last 3 years. In the last 1 year, it gave -14.35% returns.

Why to invest: The fund has consistently beaten other funds in same category along with its benchmark and provided -14.35% returns in the last 1 year. . Minimum SIP investment amount for this scheme is ₹500. This is one of the best Equity mutual fund in India.

Launch Date
Min Investment AmtN.A
AUM2,255Cr
1Y Returns-14.3%

SBI Small Cap Fund Growth

Fund Performance: This fund has consistently beaten its benchmark in Small Cap segment and provided 10.31% annualized returns in the last 3 years. In the last 1 year, it gave -14.35% returns.

Why to invest: The fund has consistently beaten other funds in same category along with its benchmark and provided -14.35% returns in the last 1 year. . Minimum SIP investment amount for this scheme is ₹500. This is one of the best Equity mutual fund in India.

Launch Date
Min Investment AmtN.A
AUM2,255Cr
1Y Returns-14.3%

HDFC Small Cap Fund Regular Dividend

Fund Performance: This fund has consistently beaten its benchmark in Small Cap segment and provided 6.94% annualized returns in the last 3 years. In the last 1 year, it gave -18.96% returns.

Why to invest: The fund has consistently beaten other funds in same category along with its benchmark and provided -18.96% returns in the last 1 year. Minimum lump sum investment amount for this scheme is ₹NaN. Minimum SIP investment amount for this scheme is ₹500. This is one of the best Equity mutual fund in India.

Launch Date
Min Investment AmtNaN
AUM7,894Cr
1Y Returns-19.0%

HDFC Small Cap Fund Regular Growth

Fund Performance: This fund has consistently beaten its benchmark in Small Cap segment and provided 6.94% annualized returns in the last 3 years. In the last 1 year, it gave -18.96% returns.

Why to invest: The fund has consistently beaten other funds in same category along with its benchmark and provided -18.96% returns in the last 1 year. Minimum lump sum investment amount for this scheme is ₹NaN. Minimum SIP investment amount for this scheme is ₹500. This is one of the best Equity mutual fund in India.

Launch Date
Min Investment AmtNaN
AUM7,894Cr
1Y Returns-19.0%

Quant Large and Mid Cap Fund Direct Growth

Fund Performance: This fund has consistently beaten its benchmark in Small Cap segment and provided 3.77% annualized returns in the last 3 years. In the last 1 year, it gave -10.79% returns.

Why to invest: The fund has consistently beaten other funds in same category along with its benchmark and provided -10.79% returns in the last 1 year. . Minimum SIP investment amount for this scheme is ₹1,000. This is one of the best Equity mutual fund in India.

Launch Date
Min Investment AmtN.A
AUM4Cr
1Y Returns-10.8%

Quant Large and Mid Cap Fund Dividend

Fund Performance: This fund has consistently beaten its benchmark in Small Cap segment and provided 3.52% annualized returns in the last 3 years. In the last 1 year, it gave -11.25% returns.

Why to invest: The fund has consistently beaten other funds in same category along with its benchmark and provided -11.25% returns in the last 1 year. . Minimum SIP investment amount for this scheme is ₹1,000. This is one of the best Equity mutual fund in India.

Launch Date
Min Investment AmtN.A
AUM4Cr
1Y Returns-11.3%

Quant Large and Mid Cap Fund Growth

Fund Performance: This fund has consistently beaten its benchmark in Small Cap segment and provided 3.52% annualized returns in the last 3 years. In the last 1 year, it gave -11.25% returns.

Why to invest: The fund has consistently beaten other funds in same category along with its benchmark and provided -11.25% returns in the last 1 year. . Minimum SIP investment amount for this scheme is ₹1,000. This is one of the best Equity mutual fund in India.

Launch Date
Min Investment AmtN.A
AUM4Cr
1Y Returns-11.3%

HDFC Small Cap Fund Direct Dividend

Fund Performance: This fund has consistently beaten its benchmark in Small Cap segment and provided 8.33% annualized returns in the last 3 years. In the last 1 year, it gave -17.9% returns.

Why to invest: The fund has consistently beaten other funds in same category along with its benchmark and provided -17.9% returns in the last 1 year. Minimum lump sum investment amount for this scheme is ₹NaN. Minimum SIP investment amount for this scheme is ₹500. This is one of the best Equity mutual fund in India.

Launch Date
Min Investment AmtNaN
AUM7,894Cr
1Y Returns-17.9%

HDFC Small Cap Fund Direct Growth

Fund Performance: This fund has consistently beaten its benchmark in Small Cap segment and provided 8.33% annualized returns in the last 3 years. In the last 1 year, it gave -17.9% returns.

Why to invest: The fund has consistently beaten other funds in same category along with its benchmark and provided -17.9% returns in the last 1 year. Minimum lump sum investment amount for this scheme is ₹NaN. Minimum SIP investment amount for this scheme is ₹500. This is one of the best Equity mutual fund in India.

Launch Date
Min Investment AmtNaN
AUM7,894Cr
1Y Returns-17.9%

Reliance Small Cap Fund Direct Bonus

Fund Performance: This fund has consistently beaten its benchmark in Small Cap segment and provided 7.2% annualized returns in the last 3 years. In the last 1 year, it gave -21.8% returns.

Why to invest: The fund has consistently beaten other funds in same category along with its benchmark and provided -21.8% returns in the last 1 year. Minimum lump sum investment amount for this scheme is ₹NaN. Minimum SIP investment amount for this scheme is ₹100. This is one of the best Equity mutual fund in India.

Launch Date
Min Investment AmtNaN
AUM7,542Cr
1Y Returns-21.8%

Reliance Small Cap Fund Direct Growth

Fund Performance: This fund has consistently beaten its benchmark in Small Cap segment and provided 7.2% annualized returns in the last 3 years. In the last 1 year, it gave -21.8% returns.

Why to invest: The fund has consistently beaten other funds in same category along with its benchmark and provided -21.8% returns in the last 1 year. . Minimum SIP investment amount for this scheme is ₹100. This is one of the best Equity mutual fund in India.

Launch Date
Min Investment AmtN.A
AUM7,542Cr
1Y Returns-21.8%

Reliance Small Cap Fund Direct Dividend

Fund Performance: This fund has consistently beaten its benchmark in Small Cap segment and provided 7.2% annualized returns in the last 3 years. In the last 1 year, it gave -21.8% returns.

Why to invest: The fund has consistently beaten other funds in same category along with its benchmark and provided -21.8% returns in the last 1 year. . Minimum SIP investment amount for this scheme is ₹100. This is one of the best Equity mutual fund in India.

Launch Date
Min Investment AmtN.A
AUM7,542Cr
1Y Returns-21.8%

L&T Emerging Businesses Fund Direct Dividend

Fund Performance: This fund has consistently beaten its benchmark in Small Cap segment and provided 7.17% annualized returns in the last 3 years. In the last 1 year, it gave -21.91% returns.

Why to invest: The fund has consistently beaten other funds in same category along with its benchmark and provided -21.91% returns in the last 1 year. Minimum lump sum investment amount for this scheme is ₹NaN. Minimum SIP investment amount for this scheme is ₹500. This is one of the best Equity mutual fund in India.

Launch Date
Min Investment AmtNaN
AUM5,611Cr
1Y Returns-21.9%

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Features of Small Cap Mutual Fund

<p>Small Cap mutual funds empower investors to earn profits from growing companies. While institutional investors are heavily invested in the more stable funds, individual investors can pick some of the <strong>best small cap growth funds, small cap value funds, and small cap index funds</strong> to earn high returns.</p> <p>Small cap mutual funds are ideal for aggressive investors who seek higher returns and are comfortable with high risk. It is worth noting that small cap companies end up getting a lot of negative media attention due to the failure of a few companies. So, small cap mutual funds provide an opportunity to invest in such companies while ensuring that your capital is invested in the right companies.</p>

Taxability

<p>Small cap mutual funds invest in equity and equity-related instrument of companies with market capitalisation less than 500 crores. If you hold your small cap mutual funds for a period of over 12 months, you will be liable to pay long-term capital gain tax which is 10 per cent of your gains. However, this is applicable only if the returns are more than Rs 1 lakh.</p> <p>On the other hand, if you sell you small cap mutual funds before 12 months from the date of purchase, a short-term capital gain tax of 15 per cent will be levied on your returns. So, selling you funds before a year will warrant a higher tax against holding the funds for over a year. It is highly recommended that you do not sell your investment on short-term market movements. You will not only pay more taxes, but you will also miss the opportunity to earn higher revenues.</p>

Who Are These Funds Suited For?

<p>The size of the company heavily influences the returns it can generate over a period of time. Companies with different market capitalisations come with a different set of opportunities. Small Cap companies come with high risk and high reward possibility. You will have to take huge risks by investing in relatively smaller companies who are yet to prove their business on a large scale.</p> <p>As a reward, if the company does well and succeeds, you will earn returns far better than any other investment instrument. Small cap mutual funds are suitable for investors with high-risk appetite and a long-term investment horizon. If you open to comparatively higher risks, you should invest a portion of your portfolio in some of the <strong>best small cap mutual funds</strong>. It is essential to ensure that only a part of your entire portfolio is in small cap funds.</p>

Major Advantages

<p>Small cap companies present an opportunity to yield higher returns compared to other instruments. While the volatility is comparatively higher, small cap companies are ideal for investors seeking long-term wealth creation. By investing in some of the <strong>best small cap funds in India</strong>, you can avoid companies with bad financials as the mutual fund houses carry out extensive research before investing.</p> <p>Not all mutual fund companies invest in small cap companies giving rise to a huge opportunity for those who do. <strong>Best small cap mutual funds in India</strong> invest in such companies with high growth potential. The growth potential for small cap companies cannot be compared with that of large cap or mid cap companies. Since these companies have a market cap that is less than Rs 500 crores, a few positive news can take it to the new highs. This is a huge opportunity for you to earn huge returns by investing in small cap mutual funds.</p>

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