Mutual funds investment: Small-cap mutual funds have continued to give stellar return in the year 2021 as a good number of small-cap funds have given more than 100 per cent returns. According to the data available on Value Research website, there are 27 mutual fund plans in the small-cap category that have delivered more than 100 per cent return in the last one year. These 27 small cap MFs includes BOI Axa Small Cap Fund, Kotak Small Cap Fund, Quant Small Cap Fund, Sundaram Select Micro Cap XVII Fund and HDFC Small Cap Fund. Out of these 27 small-cap funds, Quant Small Cap Direct Fund has delivered highest 175.78 per cent return in the last one year.
Mutual fund returns: Regular vs direct
The value research data also signals that direct plans have delivered more than regular plans. The margin of yield between regular and direct plans was found from around 1 per cent to robust 4 per cent. For example, Sundaram Select Micro Cap XVII Direct plan delivered 110.18 per cent annual return while Sundaram Select Micro Cap XVII Regular 109.05 per cent while Quant Small Cap Direct plan’s annual yield is 175.79 whereas its regular plan yield is 171.97.
So, for those who have understanding of the mutual funds investment, they should buy mutual fund plans directly instead of buying through a broker and pay higher expense ratio.
Here is the list of top 5 small-cap mutual funds in terms of returns
1] Quant Small Cap Fund: Quant Small Cap Direct Fund has delivered highest 175.78 per cent return in the last one year. Its expense ratio is 0.50. It’s is closely followed by its regular plan Quant Small Cap Regular Fund that has delivered 171.97 per cent in the last one year. This lower yield in the regular plan is probably due to the higher expense ratio in the regular plan that stands at 2.25 — 1.75 higher than the direct plan.
2] Kotak Small Cap Fund: After Quant Small Cap, Kotak Small Cap Direct Fund comes that has delivered 118.91 per cent yield in the last one year. Its expense ratio is 0.52. Kotak Small Cap Regular Fund plan has delivered 115.74, around 3 per cent lower than the direct plan. The expense ratio of the regular plan is 1.98 — 1.46 higher than direct plan.
3] Sundaram Select Micro Cap XVII: Sundaram Select Micro Cap XVII Direct Fund plan has given 110.18 per cent annual yield while Sundaram Select Micro Cap XVII Regular Fund plan has given 109.05 per cent return in the last one year. Expense ratio of the direct plan is 0.823 while expense ratio of the regular plan is 1.36, which is enough to understand the reason for lower yield by the regular plan.
4] BOI AXA Small Cap Fund: BOI AXA Small Cap Direct Fund plan has delivered 109.96 per cent in the last one year while its regular plan yield in the same period is 106.11 per cent. The Value Research Data says that expense ratio of this Bank of India direct plan is 1.18 while the same stands at 2.74 for the regular plan.
5] HDFC Small Cap Fund: HDFC Small Cap Direct Fund plan has given 103.10 per cent HDFC Small Cap Regular Fund plan has delivered 101.14 per cent. The expense ratio for direct plan stands at 0.87 while for the regular plan expense ratio is 1.86.
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