INCOME TAX21 Sept 2026
Small-cap mutual funds: How large- and mid-cap exposure differs across schemes; check 1-year returns | Mint
Small-cap mutual funds must hold at least 65% in small-cap stocks, but managers can freely use the rest for large and mid-cap shares. That's why top funds look so different today. DSP Small Cap held no large-caps and still gave the best one-year return at 17.22%, while Quant held the most large-caps. So check each fund's actual portfolio, not just its label.
Key Statutory Highlights
- Small-cap funds must keep at least 65% of assets in small-cap stocks, but the remaining portion is left to the fund manager's strategy.
- Among the top 10 funds by assets, Quant Small Cap had the highest large-cap allocation at 14.90%, while DSP Small Cap had none.
- DSP Small Cap, with no large-cap exposure, delivered the highest one-year return of 17.22%, showing that holding larger companies did not guarantee lower returns.
Actionable Advice for Taxpayers / Founders:Before you invest, look at the fund's actual large and mid-cap holdings rather than judging it by the small-cap label alone, and consider asking your advisor whether that mix suits your risk appetite.
Statutory Disclaimer: TaxQue Shorts are AI-assisted editorial briefs for compliance awareness. This brief has not passed every source check; confirm the original notification before acting. This does not constitute formal legal or CA counsel.
TaxQue News Desk
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