SBI Small Cap Fund SIP: Reopening & Key Details for Investors

SBI Small & Mid Cap fund was suspended for new investments in October 2015. It will now reopen for fresh subscriptions from 16^th May 2018, allowing people to invest via the Systematic Investment Plan (SIP) route.

SBI Small and Midcap Fund is available for SIP online on Groww.

Name & Category Change

SBI Small & Midcap Fund New Name

Old Name New Name SBI Small & Midcap Fund SBI Small Cap Fund

The fund’s name has been changed to SBI Small Cap Fund as per the new rules introduced by SEBI (Securities and Exchange Board of India).

It will fall under the category of Small Cap funds and hence would primarily invest only in small-cap stocks (stocks beyond 250^th stock in terms of market capitalization).

This will give as a brilliant option for investors if they primarily want to invest in small-cap funds.

SBI Small and Mid Cap Fund Details

Is SBI Small and Midcap Fund open for subscription? Yes, it is! Here is a table of all the details you might need. 

Old name SBI Small & Mid Cap Fund New Name SBI Small Cap Mutual Fund Opening Date 16^th May 2018 Min SIP amount Rs 500/month Max SIP amount Rs 25000/month

Performance of SBI SmallCap Fund

This fund, with Assets Under Management (AUM) of Rs 943 crores is very well managed by R Srinivasan and is among the best performing funds in the small-cap sector.

The past one and three year’s returns generated by this fund were 34.05% and 25.27% p.a. respectively, which are much higher compared to the benchmark returns of 26.35% p.a. (for 1 year) and 15.96% p.a. (for 3 years).

Hence, investing in the SBI Small-Cap Fund is an excellent option.

Why Was the Mutual Fund Closed?

This mutual fund had placed restrictions on inflows due to insufficient investment opportunities. In fact, the capital which was coming in was analyzed to be a good percentage more than the stocks which were available to invest in this sector.

This time around, to prevent overinvestment, the fund has inserted an investment cap of Rs 25,000 per month and per PAN.

Which Funds are Better than SBI Small Cap Fund?

There is no way to exactly tell which funds are better than SBI Small & Mid Cap Fund. In the future, this fund may continue to perform well or may be outperformed by other mutual funds.

Here is a list of mutual funds that are similar to SBI Small & Midcap Fund and have given very high returns:

1. HDFC Small Cap Fund Direct

This fund has given high returns over the years and has consistently outperformed its benchmark. It is a fund with high risk and has given a return of 23.74% since its launch.

Returns per annum over the years from this fund are:

Duration Returns 1 year  31.49% 3 years  24.28% 5 years  26.55%

While the fund has undoubtedly scored on the performance front, it has also managed to keep its risk metrics lower than the benchmark thereby resulting in an improved risk-reward profile.

The investment objective of the scheme is to generate long-term capital growth from an actively managed portfolio of equity and equity-related securities including equity derivatives

2. L&T Emerging Businesses Fund Direct

This is a Small Cap Equity Oriented Mutual Fund launched on May 12, 2014. It is a fund with a high risk and has given a return of 30.76% since its launch.

Returns per annum over the years from this fund are:

Duration Returns 1 year  23.72% 3 years  27.07% 5 years  NA

The objective of this fund is to generate long-term capital appreciation from a diversified portfolio of predominantly equity and equity-related securities, including equity derivatives, in the Indian.

This is one of the most attractive small-cap funds in India right now and has been rated high by almost all rating agencies.

Though this fund is new in the small-cap category, it certainly made its mark in the market.

Happy Investing!

Disclaimer: the views expressed here are of the author and do not reflect those of Groww.

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