Archive · 27 Jul 2025
Multi-cap Funds Outperform Diversified Funds
Multi-cap funds are like investment baskets that spread money across big, medium, and small company stocks, with a minimum of 25% allocated to each.
These funds aim to give investors a balanced approach to the market and have performed better than other diversified funds in recent years.
The strategy involves the fund managers actively picking stocks in these categories.
While there may be some ups and downs in the short-term, it's generally advised to stay invested long-term to benefit from market changes and the fund's strategy.
Multi-cap funds invest a minimum of 25% each in large, mid, and small-cap stocks.
These funds have shown higher long-term performance compared to diversified funds.
Alpha generation comes from tactical allocations within the 25-25-25 framework.
Short-term volatility is possible due to mid and small-cap exposure.
Investors should stay invested across cycles for optimal returns.
- Who
- Investors seeking diversified investment options.
- What
- Multi-cap funds that offer diversified exposure across market capitalizations.
- When
- Recent years have seen higher performance compared to diversified funds.
- Where
- These funds invest in stocks across the market.
- Why
- To capture opportunities across market cycles and potentially achieve higher returns.
Investor
Fund Managers
Investment Strategy
Investor
Emphasize portfolio diversification and potential higher returns
Fund Managers
None given
- Investment Strategy
- Minimum 25% in Large, Mid, and Small-cap stocks
- Average 5-year return
- 25.15%
- Allocation Approach
- Tactical, 25-25-25 framework
- Key to Success
- Staying invested across cycles
