SBI Small Cap Fund – Direct Growth

SBI Mutual Fund’s SBI Small Cap Fund Direct-Growth is an Equity mutual fund scheme. This plan was introduced on September 9, 2009, and is presently managed by R. Srinivasan. The minimum SIP investment required for this scheme is ?500.

The SBI Small Cap Fund seeks to offer investors prospects for long-term capital appreciation by investing primarily in a well-diversified basket of small-cap equity securities. The fund invests a minimum of 65% of its assets in small-cap equities.

Additionally, the SBI Small Cap Fund may invest up to 35% of its assets in other stocks (including big and mid-cap firms) and/or debt and money market instruments. The fund employs a combination of growth and value investing styles and employs a bottom-up stock selection technique.

Pros & Cons

Who should invest in SBI Small Cap Fund Direct-Growth?

Small-cap funds are a good option for those with a high-risk tolerance who want to diversify their holdings. These funds are noted for their exceptional returns during bearish markets. When the market declines, however, these funds might be adversely impacted. Your investment portfolio might benefit from allocating some of its resources to the top small-cap mutual funds.

The SBI Small Cap Fund Direct-Growth is designed for investors that have a minimum investment horizon of between 5 and 7 years. You should prepare yourself for short-term volatility in your investments because of the nature of the asset class. The fund’s performance is measured against the S&P BSE 250 SmallCap Index TR INR as its benchmark.

What are the benefits of investing in the SBI Small Cap Fund Direct-Growth?

The SBI Small Cap Growth Direct Plan has produced returns of 5.5% over the last year, 28.8% for the past three years, 12.9% over the past five years, and 25.6% since the plan’s inception.

• Small-cap mutual funds are a wonderful way to diversify your holdings and earn above-average returns. SBI Small Cap Fund Direct-Growth may serve as high-value portfolio buffers, but only if you’re willing to take on a fair amount of risk.
• If you want to get the most out of your investment, you should put it toward something that won’t be needed for at least 7 to 10 years, such as your children’s college tuition, your retirement, a down payment on a house, or any number of other long-term goals.
• Units bought before January 31, 2018, and redeemed on or after April 1, 2018, are free from long-term capital gains tax on gains realised through that date. The DDT will be covered by the mutual fund.