Small-cap funds are also in great demand by the growth-oriented investors. They focus on firms that are young and growing rapidly and that have less access to credit facilities. Two well-known funds in this category are the SBI small cap fund and the AXIS Small Cap Fund. Now, let it be seen how their features and their performance, together with the resultant benefits, are different.
Overview of SBI Small Cap Fund
The SBI Small Cap Fund focuses on high-growth potential small companies. It employs a bottom-up technique of stock selection, as is the case with the majority of value-oriented firms. By utilizing this strategy, great quality businesses with sound structures are targeted.
It has been evidenced that the fund has generated high long-term performance results. Overall, it is one of the most effective funds across the globe as per the average yearly return across its peer category. Bears the label of stock for those interested in accumulating and building up wealth within a five- to ten-year period.
The fund manager follows diversification as one of the best asset management strategies. It makes profits from companies across the different sectors that cut across the world. This in turn curtails the risks while optimizing the returns.
Key Features of the AXIS Small Cap Fund
The AXIS Small Cap Fund aims to identify businesses with sustainable growth potential. It has a systematic method of its investment process. The fund manager tends to select more quality stocks in the portfolios rather than so many stocks.
showed good and sustainable performance in the couple of years. This remains so since the fund has a low volatility and attracts investors with lower risk appetites. It has a careful approach to risk and returns, and generally this is well managed.
Like the SBI Small Cap Fund, this fund also invests in various industries. This proves the fact that concentration of the firm on these basic areas guarantees a constant return.
Comparing Returns and Risk
Both funds have fetched good returns in the long run. The SBI Small Cap Fund is suitable for aggressive investors. It makes big bets in the right areas of growth.
The AXIS Small Cap Fund offers a more conservative approach. The hedge fund targets companies with low, steady growth rates. This is a good fund for investors who do not like much volatility in relation to their portfolio.
The risk level that is attached to the two funds varies. SBI Small Cap Fund has higher risk due to its aggressive strategy. AXIS small cap fund maintains lower risk by investing in well-established small companies.
Conclusion
Long term, small cap can enhance the wealth of a fund. Both SBI Small Cap Fund and AXIS Small Cap Fund are strong options.Examine their reports and their analyses of plans and actions cautiously. These are normally set by the management depending on their objectives; choose the one that corresponds with your personal or organizational goals. In any investment, make sure to seek the services of a qualified financial planner.
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