These smallcap schemes could be at risk as they have lesser exposure to large stocks, cash and cash equivalents (including T-bills), and higher exposure to stocks from the Nifty Microcap 250 Index
Rising equity markets are bringing investors into mutual funds through SIPs. And insurance companies want to have a pie. Insurers have now increasingly started using terms like NFOs, index, fund, switch, NAV, SIIP, market risks, etc. that are used for mutual fund products. While both offer investments in stock markets, the entry costs, lock-in period, and withdrawal terms differ. Be mindful of the differences.
Nippon India Small Cap Fund(G) which predominantly invests in smallcap stocks has given extended internal rate of returns (XIRR) of over 37% according to data sourced from Ace Equities, earning Rs 8.80 lakh on the total investment of Rs 6 lakh made between February 22, 2019 and February 22, 2024. Meanwhile, the 5-year CAGR returns stand at 30.57%.
The scheme which was launched on October 29, 1996 is benchmarked against Nifty Smallcap 250 - TRI and has given returns at an XIRR of 35% while at a CAGR of 40% during this period.