These 5 multi-cap funds turned ₹10K SIP into ₹25L+ in 10 yrs

Summary: Multi-cap funds have been on a strong run, posting strong returns across various time periods. Here, we look at five multi-cap funds that grew a simple Rs 10,000 monthly SIP into over Rs 25 lakh in just 10 years.

Multi-cap funds are diversified equity mutual funds that invest across companies of different sizes (large, mid and small cap). This structure allows fund managers the flexibility to allocate money across the market spectrum and capture opportunities wherever they see the most potential.

In September 2020, SEBI’s recategorisation rules tightened the definition of multi-cap funds, mandating them to invest at least 25 per cent each in large-cap, mid-cap and small-cap stocks. This change ensured that multi-cap funds truly remained diversified across market capitalisations, rather than leaning heavily towards a single segment.

How have multi-cap funds fared so far?

Over the years, the multi-cap category has delivered strong long-term returns, even outstripping flexi-cap funds over three- and five-year periods. Their ability to combine stability from large companies with the growth potential of mid- and small-cap stocks has helped many investors build substantial wealth through disciplined investing.

In fact, a monthly SIP (systematic investment plan) of Rs 10,000 in some of these funds has grown to more than Rs 25 lakh over a 10-year period.

Below is a list of five such five multi-cap funds that achieved this milestone.

#5 Sundaram Multi Cap Fund

• 10-year SIP return: 14.74 per cent
• Value of a Rs 10,000 monthly SIP after 10 years: Rs 25.26 lakh
• Assets under management (AUM): Rs 2,827 crore
• Expense ratio: 0.89 per cent

#4 Baroda BNP Paribas Multi Cap Fund

• 10-year SIP return: 15.39 per cent
• Value of a Rs 10,000 monthly SIP after 10 years: Rs 26.77 lakh
• Assets under management (AUM): Rs 3,096 crore
• Expense ratio: 0.90 per cent

#3 ICICI Prudential Multicap Fund

• 10-year SIP return: 15.80 per cent
• Value of a Rs 10,000 monthly SIP after 10 years: Rs 27.48 lakh
• Assets under management (AUM): Rs 16,315 crore
• Expense ratio: 0.94 per cent

#2 Quant Multi Cap Fund

• 10-year SIP return: 16.96 per cent
• Value of a Rs 10,000 monthly SIP after 10 years: Rs 29.28 lakh
• Assets under management (AUM): Rs 7,274 crore
• Expense ratio: 0.73 per cent

#1 Nippon India Multi Cap Fund

• 10-year SIP return: 17.72 per cent
• Value of a Rs 10,000 monthly SIP after 10 years: Rs 30.37 lakh
• Assets under management (AUM): Rs 50,820 crore
• Expense ratio: 0.71 per cent

Are multi-cap funds right for you?

Before rushing to invest, it is important to understand whether multi-cap funds suit your portfolio. These funds are typically ideal for investors looking for a single diversified equity fund that spreads investments across market segments. Because they include mid- and small-cap exposure, they can be more volatile than pure large-cap funds in the short term. However, their diversified structure can also help capture broader market growth over long periods. 

Multi-cap funds are therefore best suited for investors with a long-term horizon, preferably 7-10 years or longer, and the ability to stay invested through market ups and downs.

That said, strong past performance alone should not be the sole reason to invest in any fund. A fund that has delivered impressive returns over the past decade may not necessarily continue to do so in the future. Investors should consider factors such as the fund’s investment strategy, consistency of performance, risk profile and how well it fits into their overall portfolio.

Should you consider investing in any of the abovementioned funds?

If you are wondering whether any of the five multi-cap funds listed above deserve a place in your portfolio, Value Research Fund Advisor can help. Our research team evaluates hundreds of funds to identify those with the potential to deliver sustainable long-term returns. Find out whether any of these funds feature in our ‘Buy’ list and discover the best options suited to your investment goals with Fund Advisor.

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