Multi Cap Fund

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Multicap Funds

Discover a disciplined equity solution that blends the growth potential of mid and small companies with the stability of established large businesses—all in one diversified portfolio with Multicap Funds

All about Multicap Funds?

Multicap funds are equity mutual funds that invest across the entire equity market spectrum — large (Stocks part of Nifty 100 index), mid (Stocks part of Nifty Midcap 150 index), and small-cap (Stocks part of Nifty Smallcap 250 index). Instead of concentrating on just one segment, they maintain a balanced allocation, so your portfolio stays diversified.

As per regulatory requirements, Multicap funds maintain a minimum 25% exposure to each market capitalization segment.

This ensures that these funds maintain balanced diversification, with at least 50% allocation in mid and small caps combined segments that often provide higher growth opportunities but also exhibit higher volatility compared to large caps.

Why Invest in Multicap Funds?

Equity markets don’t move uniformly. At times, large caps outperform, in bullish phases, mid and small caps often lead the rally. Trying to predict which category will perform better is difficult. This is where Multicap Funds step in. With a fixed exposure to each market cap segment, you don’t have to constantly switch between funds or worry about missing out on opportunities. No matter which segment shines, your portfolio benefits.

If you had invested ₹10,000 at the time of inception, the Nifty 500 Multicap 50:25:25 Index would have grown that investment to about ₹2.03 lakh. In comparison, the same amount in the Nifty 50 TRI would be worth around ₹1.52 lakh, and in the Nifty 500 TRI about ₹1.59 lakh.

This underscores the effectiveness of the Multicap strategy — by diversifying across large, mid, and small-cap segments rather than focusing solely on large-cap stocks, investors have been able to tap into growth opportunities throughout the market. Over the long term, this disciplined and broad-based approach to diversification has consistently delivered significantly higher wealth creation compared to strategies limited to large caps or even the broader market index.

*Source: MFI Explorer, Data for the period Apr 2005 – August 2025. The above is for illustration purpose only, It should not be construed to be indicative of scheme performance in any manner.Past performance may or may not be sustained in future.

Key Advantages

Superior Risk-Adjusted Returns

Multicap funds deliver strong risk-adjusted returns by capturing nearly all the upside of the market while moderating downside volatility.

Resilience During Market Volatility

Volatile markets require investment strategies that are flexible yet disciplined. Multicap funds limit downside risk effectively during turbulent periods, protecting investor capital while positioning to benefit from market recoveries. This dynamic reduces drawdowns and enhances wealth preservation.

Opportunity Across Market Caps and Sectors

By maintaining meaningful allocations to mid and small caps, Multicap funds tap into broader growth opportunities, including sectors often underrepresented in traditional large-cap focused indices. This sector diversification helps investors benefit from India’s accelerating economic growth story, which spans well beyond large-cap companies

Attractive Valuations and Long-Term Growth Potential

Recent valuation corrections in mid and small cap segments have created compelling opportunities for long-term investment. Combined with structural factors such as GST rationalization and India’s emergence as the fastest growing large economy, these funds are well-positioned to capitalize on sustained growth across market segments.

Disclaimer: An Investor Education and Awareness Initiative.

Investors should deal only with registered Mutual Funds, details of which can be verified on the SEBI website (https://www.sebi.gov.in) under ‘Intermediaries/Market Infrastructure Institutions’. Please refer to website of mutual funds for process for completing one-time KYC (Know Your Customer) including process for change in address, phone number, bank details etc. Investors may lodge complaints on https://scores.sebi.gov.in against registered intermediaries if they are unsatisfied with their responses. SCORES facilitates you to lodge your complaint online with SEBI and subsequently view its status.

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