How long should we hold Small cap funds ?


KF Ace
I know that Mutual funds are long term investment but does it go same for small cap funds too ?


KF Mentor
Yes surely, it goes for the Small Cap Funds as well. But, if you want to make them a small cap investment. Then you have to take expense ratio and exit load in the consideration as well

Samir Gupta

KF Rookie
Small-cap stocks represent companies with smaller market capitalizations, and they can experience greater price fluctuations compared to larger, more established companies. This volatility can be both a risk and an opportunity. If you can withstand short-term market fluctuations and have a long-term investment horizon (typically at least 5-10 years or more), small-cap funds may have the potential to deliver higher returns.


KF Rookie
Before investing in small cap mutual funds there are two things that should be taken into consideration your age and your patience. if you're a young individual then you should invest in small cap funds for at least 15 years. Because small cap funds experience greater market fluctuations it will test your patience as well but you have to be disciplined and let the market do its thing.


KF Ace
Small cap Mutual funds are the riskiest of all categories of mutual funds.
1. So, Firstly Its better to search for the best performing mutual funds right now.
2. Secondly, best time for mutual fund investment is when the markets got correction of 15% at least. so that your risk of loosing capital gets minimised a lot.
3. Third, Review your mutual funds in every 6 months, because if someone is performing better today doesn't mean that it will perform better at later stage also.
4. Last, In Approx. every 3-4 years market corrects heavily like 25-30%, so when the markets correct mutual will also go down. so don't panic and keep invested.

Happy Investing.
The recommended time frame is eight to ten years. Making these funds highly suitable for long-term investors. Small Cap Funds offer great potential to earn benchmark-beating returns. These are highly risky investments and should be considered when you can handle the price volatility.