Should you set up an SWP in a small-cap fund?

If we build a small-cap-heavy portfolio, how do we transition to a lower volatility portfolio that is suitable for setting up an SWP? Alternatively, can we set up an SWP on a small-cap fund with a high corpus? - Hariharan Ananthanarayanan Small-cap investments are risky. I tried to simulate your situation to illustrate this. Suppose someone had Rs 1 crore in a small-cap fund and withdrew 10 per cent of it annually since 2006. Despite these withdrawals, the investment would still grow to ₹6.3 crore. This shows how high the returns from small-cap funds can be. However, I'm not suggesting withdrawing 10 per cent annually; in fact, I usually recommend being more conservative in the initial

This article was originally published on December 05, 2024.