4 Types of Funds Exists in Stock Market

2019 ias preliminary exam test series

Large Cap Funds:

Large cap mutual funds invest in companies with market capitalisation of over Rs 20,000 crore. Fund managers look at the Sensex or BSE-100 Index of Nifty as a reference point.

Ex: Franklin India Bluechip Fund and ICICI Pru Focused Bluechip Equity Fund are large cap funds.

Midcap Funds:

The midcap-oriented funds in vest in companies having market capitalisation from Rs 5,000 crore to Rs 20,000 cr. BSE Midcap NSE Midcap index can be considered as the reference point.

Ex: Kotak Midcap Fund and Motilal Oswal Focused 30 Midcap Fund are mid cap funds.

Smallcap Funds:

The smallcap or microcap funds invest in companies with market capitalisation less than Rs 5,000 crore. BSE Small cap index can be considered as the reference point.

Ex: Reliance Small Cap Fund and DSP Micro Cap Fund are smallcap funds.

Multicap Funds:

Multicap funds are diversified mutual funds that can invest in stocks across market capitalisation. Assets can be invested in shares of large, medium (or) small size companies.

Ex: Motilal Oswal Multicap 35 Fund and Kotak Select Focus are examples of such funds.

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