How SIP in Multi Cap Funds Faired from Other Equity Funds – A Comparative Study

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How SIP in Multi Cap Funds Fared from Other Equity Funds – A Comparative Study

LET’S FIRST UNDERSTAND WHAT IS MULTI CAP? 

Multi-cap funds, as the name implies, allocate their capital to a wide range of different market capitalizations’ equity and equity-related stocks. Therefore, investments in large-cap, small-cap, and mid-cap companies can be found in a multi-cap fund. Each plan allocates its funds in a slightly different manner, making multi-cap funds a flexible way to invest across a diverse range of industries and capitalizations.
Before we talk about the different kinds of investors who should consider investing in multi-cap funds, let’s take a quick look at how the various multi cap equity funds have performed in comparison to one another.

TOP PERFORMING MULTI CAP FUNDS & NIFTY 50 TRI



Graphical Representation of Top Performing Multi Cap Funds & NIFTY 50 TRI


Source: Advisor Khoj, data as on 3rd January 2023. Disclaimer: Mutual funds are subject to market risks. Past performance may or may not be sustained in the future.

From the above chart and graph, you can analyze the performance of the top performing Multi-Cap Funds.

  • The top performing multi cap fund (Quant Active Fund Gr) gave the highest 10-year return of 22.42%. the one who had done the SIP of ₹10,000 per month for 10 years had invested a total of ₹1200000. The current value of their investment amounts to ₹3863541.74.
  • The second top performing multi cap fund is Nippon India Multi Cap Gr Gr fund providing with the 10 years return of 14.92%. if someone had invested ₹10,000 every month through SIP in this fund for 10 years, he had invested the total of ₹1200000. The current value of their investment amounts to 2591344.26.
  • The third top performing multi cap fund is Invesco India Multi Cap Gr fund providing with the 10 years return of 14.74%. if someone had invested ₹10,000 every month through SIP in this fund for 10 years, he had invested the total of ₹1200000. The current value of their investment amounts to 2566164.96.

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For Whom Are Multi-Cap Funds Best?



THE BENEFITS OF INVESTING IN MULTI-CAP FUND SIP

Investment Diversification -

Multi-cap funds provide a diversified portfolio because they invest in companies of various sizes and sectors. This diversified approach reduces your risk. Different sectors or parts of the market can perform differently at any given time, so spreading out investments controls risk.

Exposure to all economic sectors -

With these funds, you can diversify your holdings and gain exposure to the various industries and companies that are propelling the Indian economy forward, regardless of their size or market cap. As a result, you can profit from every opportunity that emerges in the Indian market.

Market-appropriate portfolio -

These funds can adapt to shifting market conditions by altering the proportion of their holdings in large, mid, and small companies. The fund manager could switch to large caps and adopt a defensive strategy, for example, if mid- and small-cap stocks become overvalued and it appears that they are on the verge of becoming large-cap stocks.

What if you have a Lumpsum amount in your Bank and you want to take benefit of SIP in Multi Cap Fund?

Keeping that amount in your bank savings a/c will only give you 2.5-3% interest. Put that money in a scheme that gives you 1% per month, not necessarily from Mutual Funds, but it is possible to get a consistent 1% withdrawal from P2P investments.

Various Investment Plans Under P2P Lending



P2P Lending provides you with a variety of investment opportunities that suit your various requirements and help fulfil your different financial goals.

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For example,

1. Under P2P Lending Fixed Term, there are three plans based on different time horizons. In the fixed term an investor has to invest a sum of money for a fixed amount of time.

• Up to 12% P.A. Returns (12 Months Plan, Min. Investment: ₹50K)
• Up to 11% P.A. Returns (6 Months Plan, Min. Investment: ₹1L)
• Up to 10% P.A. Returns (3 Months Plan, Min. Investment: ₹2L)

2. Under P2P Lending Monthly Income, there are two plans based on different time horizons. In the monthly income plans an investor has to invest a sum of money for a mentioned amount of time and can withdraw monthly.

• Up to 10% P.A. Returns (24 Months Plan, Min. Investment: ₹50K)
• Up to 10.5% P.A. Returns (36 Months Plan, Min. Investment: ₹50K)

3.Under P2P Lending Freedom Plan, there is only one plan providing freedom from time horizon. An investor in the freedom plan must invest a sum of money without regard to time horizons and may withdraw at any time.

• Up to 8.25% P.A. Returns (On Demand Plan, Min. Investment: ₹3L)


P2P Lending provides you 1% monthly withdrawal in its investment plan.
So, by taking that monthly withdrawal in your bank a/c you can invest that earned interest amount through a SIP in Multi Cap fund and can avail the benefit of Multi Cap Sip.
In this way, you can earn double income from the Same amount of money invested. So, instead of earning 2.5-3% interest in a bank savings account, you can earn double the amount by investing in P2P Lending and taking advantage of the Multi Cap SIP benefit.
We look forward to a new investment with you this year.

Regards,
Ajay Kumar Jain,
CMD
Swaraj FinPro Pvt. Ltd.
+919993025625 (Call or WhatsApp)

Mutual Fund Investments are subject to market risk, read all scheme related documents carefully.

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