Archive · 18 Jul 2026
4 Small Cap Funds Outperformed in H1 2026
In the first half of 2026, the Indian stock market was very uncertain because of things like the US-Iran war and rising oil prices.
Despite this, small cap mutual funds did really well.
Four small cap funds stood out: Bank of India Small Cap Fund, TRUSTMF Small Cap Fund, JM Small Cap Fund, and Union Small Cap Fund.
These funds invested in smaller companies and gave high returns.
The best one, Bank of India Small Cap Fund, gave 21.9% returns.
The funds invested in different small companies like Wockhardt and Navin Fluorine International.
However, large cap funds did not do well because foreign investors sold many big company stocks.
Investors should be careful and choose funds wisely, as small cap funds can be risky.
The first half of 2026 saw significant uncertainty in the Indian equity market due to global events like the US-Iran war and rising crude prices.
Small cap mutual funds were the top-performing category in H1 2026, with four funds delivering impressive returns.
Bank of India Small Cap Fund was the best performer with 21.9% returns, followed by TRUSTMF Small Cap Fund (20.3%), JM Small Cap Fund (17.5%), and Union Small Cap Fund (17%).
The funds invested in various small cap stocks such as Wockhardt, Navin Fluorine International, and Acutaas Chemicals.
Large cap funds faced negative returns due to heavy selling by foreign institutional investors (FIIs).
- Who
- Investors and FIIs
- What
- Performance of small cap mutual funds in H1 2026
- When
- First half of 2026
- Where
- Indian equity market
- Why
- Due to uncertain global environment and better relative valuations of small cap stocks
Investors
FIIs
Investment Strategy
Investors
Investors lapped up small cap stocks after last year’s underperformance, benefiting from better relative valuations.
FIIs
FIIs heavily sold bluechip stocks, impacting large cap funds negatively.
- Top Performing Fund
- Bank of India Small Cap Fund (21.9% returns)
- Benchmark Returns
- Nifty Smallcap 250 – TRI (6.9% returns)
- Category Average Returns
- 10.4%
- Bottom Performing Fund
- -0.6%
- Top Stocks in Bank of India Small Cap Fund
- Wockhardt, Sky Gold and Diamonds, Acutaas Chemicals, Lloyds Metals & Energy, Quality Power Electrical Equipments
- Top Stocks in TRUSTMF Small Cap Fund
- Navin Fluorine International, Multi Commodity Exchange of India, Acutaas Chemicals, Cemindia Projects, Sai Life Sciences
- Top Stocks in JM Small Cap Fund
- Garware Hi-Tech Films, Acutaas Chemicals, Godfrey Philips India, TD Power Systems, Shaily Engineering Plastics
- Top Stocks in Union Small Cap Fund
- GE Vernova T&D India, Acutaas Chemicals, Navin Fluorine International, Karur Vysya Bank, Multi Commodity Exchange of India