A steadfast performance

At Value Research, the 'growth' category constitutes flexi-cap, large & mid-cap and value-oriented funds. These funds are designed to be the 'backbone of your equity portfolio', making them ideal for long-term wealth creation. Increasingly, multi-cap funds are also emerging as a promising addition to your core portfolio. Going forward, expect some of them to make an entry to our recommendations. When you invest in growth funds, you're gaining exposure to India's top 500 companies. About 64 per cent of them comprise large-cap stocks, while 18 per cent constitutes mid caps and small caps make up the rest. Growth funds typically invest in a mix of 'growth' stocks (companies with strong growth potential) and 'value' stocks (companies trading at attractive valuations), regardless of category. Each investing style performs differently over time. Notably, value investing, which had fallen out of favour between 2018 and 2020, has continued its impressive run this year, despite the rise of smart-beta factors. Highlights & trends Performance: Growth funds have largely outperformed the BSE 500, led by multi-cap funds, which beat the index by 6.77 per cent, due to a robust rally in mid- and small-cap stocks. They were followed by large & mid-cap and value funds. While flexi-cap funds also outpaced the index, they posted a more modest alpha of 3.31 per cent. Sectoral shifts: Owing to a prolonged slump in the Financial Services sector, these funds have downsized their exposure. On the ot

This article was originally published on November 15, 2024.