Nippon India Small Cap Fund- Make Your Growth Strong

Introducing Nippon India Small Cap Fund

Have you heard the saying, ” Little Investments, Big Growth with Nippon India Small Cap Fund“? If yes, let’s examine the scheme from every angle. The scheme was launched by well-known Nippon India Mutual Funds.

The scheme invests in the growth story of the nation to give upliftment in its economy. The investments are done in the small cap firms of the market that have capitalization below Rs. 5000 Crores.

Additionally, the scheme has been running since September 16, 2010. These small cap firms are coming up with innovative ideas to stand out in the market. Moreover, these firms have more potential to produce good returns.

The scheme has a skillful crew with a deep understanding of the market traits. They design plans by understanding your needs and goals based on market conditions. Furthermore, the team is managing total assets of Rs. 61,027 Crores.

In addition, the scheme is outperforming the benchmark NIFTY Small Cap 250 TRI. Also, the scheme has given a good return rate of 22.03% since its launch. The scheme has investments in various sectors. For example, Industries, Finance, Materials, and others . Let’s elaborate on the description of the scheme by start learning about its features.

Is Nippon India Small Cap Fund Reliable?

Here in this section, you’ll get to know the good side of the scheme through its features:

1. Long-term Investments : The small cap firms are on the verge of growth in the market. The scheme gives you an experience of good earnings with long-term investments. It outperforms productivity with investments that hold for at least 4-7 years or more.
2. High-Potential Growth : The small cap firms aim to give innovative solutions to grow the nation’s economy. The outperformance of these firms in the market encourages more innovations. Hence, the Nippon India Small Cap Fund also strives for its productivity. As a result, the scheme gives you strong potential by providing you with good earnings.
3. Investment Approach : This fund has various investment approaches like lump sum and systematic investment plan. These approaches make your investments simple and convenient. The lump sum takes a huge amount to benefit you. On the other hand, a systematic investment plan takes a small amount to give you good earnings.
4. Fund Management : The scheme is under the management of fund manager Mr. Samir Rachh. Under his guidance, the team allocates the investments according to the market statistics. Moreover, by understanding the market conditions they design strategies for you.
5. Diversification : The scheme has investments in various small cap firms of different sectors. Also, these firms are less explored in the market. Hence, the scheme gives you exposure to explore the sectors from its growing stage. Moreover, it gives your portfolio full of benefits from investments in various sectors.

However many advantages, it is equally important to address the other side of the scheme.

How Risky is the Nippon India Small Cap Fund?

Here on the other side, there are risk factors of the scheme that you should know while investing in it:

1. Market FluctuationsThe market economy is volatile. The inherent ups and downs affect the performance of the scheme significantly. Hence, when the market is not favorable including the firms. Then this underperformance brings with lower return rate of the scheme. As a result, it gives you with low earnings.
2. Liquidity Risk : It is important to manage the actual return value of the investments. It becomes quite difficult in the case of small cap firms. The frequent investing and redeeming of the investments in the scheme become costly. This frequent process results in making the expense ratio of the scheme costly. Consequently, this cost is reduced from your net earnings over time.
3. Less Transparency : The small cap firms are an unexplored part of the market. Hence, the Nippon India Small Cap Fund has less information about the firms. It creates less clearance for the scheme regarding the performance of the firms. Hence, in case the business is falling then the investment in such a firm affects your earnings.
4. Less Stability : The small cap firms are not stable enough like the well-established firms. The stability comes with time. Hence, the scheme grows with time. In case, the firms are acting against the market or the business is in loss then the scheme underperforms automatically. As a result, it will have a significant effect on your earnings.
5. High-Cost : The less known firms take lots of research that charges high. Hence, the operational and research work is a bit costly due to the less informative nature of the firms. Moreover, the continuous liquidity process makes the expense ratio quite expensive. Consequently, it lowers your net earnings.

With the knowledge of features and risks related to the scheme. Let’s understand the appropriateness of investing in the scheme.

Who is Appropriate for the Nippon India Small Cap Fund?

Expand your knowledge about the scheme by learning the fitness criteria to invest in it:

1. Growth Seeker : The scheme makes investments for a long-term horizon. If you are willing for long-term goals and make your finances stable for a long time. Then the scheme gives you a benefit from the consistency of good earnings that last long.
2. Strong Potential Seeker : The small cap firms have the potential to grow but have less stability. The scheme believes in growth potential instead of stability. If you wish for a strong potential. Then the scheme gives you enough caliber to stand out in the market when the conditions are not in favor.
3. Strong Potential Seeker : The small cap firms have the potential to grow but have less stability. The scheme believes in growth potential instead of stability. If you wish for a strong potential. Then the scheme gives you enough caliber to stand out in the market when the conditions are not in favor.
4.  Diversification Seeker : The scheme invests in small cap firms of different sectors. If you want to explore the sectors from their growing stages. Then the scheme brings your portfolio with a variety of investments in such sectors.
   
   Let’s wrap up the description of the scheme and take a quick recap of it in the summary.

Final Note

In short, the small cap firms are hidden gems of the market that promote long-term growth. The scheme invests in such growing firms of different sectors. Along with many benefits this scheme also holds the unavoidable risks.

Wait you can still reduce these market risks by SIP investments. These investments follow the path of regular investing. Moreover, you can easily start investing with a small amount and gradually upgrade it. These investments strengthen your income and growth. Hence, let your journey grow steadily.