Key Points
Investors with negligible exposure to small caps can use the new fund offers (NFO) of Baroda BNP Paribas and Quantum Small Cap to allocate money to the space..
Wealth managers believe an allocation to small-caps is essential to generate alpha as it has high growth companies and is under researched...
However, investors should invest in a disciplined manner with at least a 5-year time frame and restrict allocation to 10-25% allocation...
Small cap funds have attracted huge interest from investors with such schemes seeing inflows of 22,051 crore this calendar year - the highest amongst all equity MF categories..
With the Indian economy expected to grow by 7-8% in the coming years, analysts believe there is a huge opportunity for small-cap companies, many of which are present in new and emerging sectors of the economy..
