Small and Midcap Vs Micro Cap

POSTED BY Dominic Prakash ON November 18, 2010 8:11 pm COMMENTS (2)

I have Sundaram Select Midcao and ICICI Discovery. My SIP cycle in Sundaram is getting over and I thought of ditching Select Midcap. I was doing some research in value research and I found that the IDFC Premier Equity A and DSPBR Small & MidCap funds performed very well compared to Select Midcap.

Also noted that DSP BlackRock Micro cap (5*) is even better. Why may of you are not suggesting this fund at all.

2 replies on this article “Small and Midcap Vs Micro Cap”

  1. Dominic Prakash says:

    Thanks. Clear as Crystal.

  2. Ramesh Mangal says:

    “What used to work may not work in future”.
    DSP Microcap fund has been very volatile. If you can digest that volatility (includes both high gains as well as high losses), good luck to you. Not many people can do that. Seeing your money down by 60% is not easy (as happened in 2008 with this fund).
    Overall, one should have a well-diversified portfolio consisting of large/mid/small caps, value/growth companies, etc. In that universe, if you want to keep the representation of small cap companies through this particular fund, then it is ok.
    But if you want to keep that fund just because it has performed very well, then you are taking a high risk. Just for clarity sake, no rating agency recommended that fund previously, as far as I know. And high ratings are not a guarantee that it will continue to perform well. 🙂

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