3-in-1 fund
Seeks to invest in quality stocks that are growth-oriented and trading at favourable valuations.
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BAJAJ FINSERV ASSET MANAGEMENT LIMITED.
Quality, value and growth
High return potential
The objective of the Scheme is to generate long term capital appreciation by investing in equity and equity related securities of small cap companies.
However, there is no assurance that the investment objective of the Scheme will be achieved.
To tap into the growth potential of small caps while mitigating risk, the investment strategy of the Bajaj Finserv Small Cap Fund rests on five pillars, as follows:
3-in-1 fund
Seeks to invest in quality stocks that are growth-oriented and trading at favourable valuations.
Read MoreStrong fundamentals
Seeks out companies with consistent earnings, sustainable competitive advantages, strong management and robust business models.
Read MoreRisk management
Aims to find potential opportunity in volatility while mitigating risk through forensic research and analysis.
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Nimesh Chandan has over 24 years of experience in the Indian Capital Markets. He has spent 18 years in Fund Management- managing and advising domestic and international investors, retail as well as institutional. Prior to joining Bajaj Finserv Asset Management Ltd., he has worked with Canara Robeco Asset Management as Head of Investments, Equities (Domestic and Offshore). He has also worked with other asset management companies including Birla Sunlife Asset Management, SBI Asset Management and ICICI Prudential Asset Management.
Sorbh Gupta has over 16 years of experience in the Indian Capital Markets. In November 2022, he was appointed as Head – Equity at Bajaj Finserv Asset Management Limited. Prior to joining Bajaj Finserv Asset Management Limited, he was associated with Quantum Asset Management Company Private Ltd. He has also worked with other financial companies such as Siddhesh Capital Markets Pvt. Ltd. and Pranav Securities Pvt. Ltd.
Siddharth Chaudhary joined the Company in July 2022 as a Senior Fund Manager – Fixed Income. Prior to this, he was associated with Sundaram Asset Management Co. Ltd from April 2019 - July 2022 as Head Fixed Income – Institutional Business. From April 2017 – March 2019, he served as a Head – Fixed Income, and from August 2010 – March 2017 as a Fund Manager – Fixed Income with Sundaram Asset Management Co. Ltd. During June 2006 – September 2010, he was working as Senior Manager, Treasury Dept in Indian Bank.
| Instruments | Indicative allocations (% of total assets) | |
|---|---|---|
| Minimum | Maximum | |
| Equities & Equity related securities of small cap companies | 65% | 100% |
| Equities & Equity related securities of other than small cap companies, equity & equity related securities of foreign companies | 0% | 35% |
| Debt and Money Market Instruments* | 0% | 35% |
| Units issued by REITs and InvITs | 0% | 10% |
*Debt instruments shall be deemed to include securitized debts (excluding foreign securitized debt). Money market instruments will include commercial papers, commercial bills, Triparty REPO, Reverse Repo and equivalent and any other like instruments as specified by SEBI and Reserve Bank of India from time to time.
Bajaj Finserv Small Cap Fund
An open ended equity scheme predominantly investing in small cap stocks
Rs. 100/- and in multiples of Re. 1/- thereafter.
Nil
For each purchase of units through Lumpsum / switch-in / Systematic Investment Plan (SIP) and Systematic Transfer Plan (STP), exit load will be as follows:
to view Total Expense Ratio
Small cap funds are equity mutual funds that invest chiefly in stocks of small cap companies. These are companies that are listed 251 and beyond (in terms of market capitalization) on recognized stock exchanges. Typically, small cap companies tend to offer higher long-term growth potential than mid or large caps but also come with significant volatility.
When you invest in the Bajaj Finserv Small Cap Fund, you can choose between two types of plans: Direct Plan and Regular Plan. Both follow the same investment strategy, but the investment route and cost will differ.
| Aspect | Regular Plan | Direct Plan |
|---|---|---|
| How you invest | Through a registered mutual fund distributor | Directly with the asset management company |
| Assistance and guidance | Distributor assists with fund selection, investment amount, duration, and goal alignment | No distributor support; investor manages investments independently |
| Transaction support | Distributor helps with application and ongoing transactions | Investor handles all transactions |
| Expense ratio | Slightly higher due to distributor commissions | Relatively lower as there are no commission costs |
| Impact on returns | May be slightly lower due to higher expenses | May result in slightly higher net returns over time |
You can invest in the Bajaj Finserv Small Cap Fund either online or offline, directly with Bajaj Finserv AMC or through a registered mutual fund distributor. If you invest online through the Bajaj Finserv AMC website, follow these steps:
To invest offline, you will need to fill out an application form and submit it independently or through a distributor at any official point of contact (OPAT) of the AMC.
The Bajaj Finserv Small Cap Fund is taxed as an equity mutual fund. The following tax rates apply:
| ELSS Tax Saver Fund | Healthcare Fund | Multi Cap Fund |
|---|---|---|
| Large and Mid Cap Fund | Flexi Cap Fund | Large Cap Fund |
| Consumption Fund | Banking and Financial Services Fund |
| Equity Funds | Debt Funds | Hybrid Funds | Index Funds |
|---|---|---|---|
| Exchange Traded Fund Funds | Savings+ | All Mutual Funds |
Small cap funds are equity mutual funds that invest primarily in small cap companies. As per regulatory norms, small cap companies are those ranked 251 and beyond in terms of market capitalization on recognised Indian stock exchanges. Such companies may offer higher long-term growth potential than larger firms, but they tend to be more volatile.
Small cap funds can see sharp fluctuations and dips, especially during market downturns. Lower liquidity, limited analyst coverage, and investments in early-stage business can also make these investments more unpredictable.
The Bajaj Finserv Small Cap Fund will adopt a risk-prudent approach to tap into the long-term growth potential of small cap companies without taking on disproportionate risk. This will be done by focusing on quality companies with strong fundamentals and sustainable business models. Stocks will be identified through in-depth research, forensic checks and a robust screening system.
You can invest in small cap funds directly through Bajaj Finserv Asset Management Ltd or through a registered distributor. To apply online, click on the invest now button at the top of this page, which will redirect you to the investor portal. To invest offline, fill out the application form and submit it to the official point of acceptance (OPAT) of the AMC.
You can invest in both lumpsum as well as SIP (Systematic Investment Plan).
The Bajaj Finserv Small Cap Fund follows a 3-in1 approach, combining elements of value, growth, and quality. It looks for small cap companies with strong fundamentals that are trading below their intrinsic value and have the potential for sustainable long-term growth.
The fund’s risk classification is based on the portfolio composition as well as SEBI guidelines and is subject to periodic review. Refer to the Riskometer above on this scheme page and latest documents for the current risk level.
There is no lock-in period for Bajaj Finserv Small Cap Fund. However, exit loads may apply for redemptions made before a certain period of allotment of units. Please refer to the Load Structure/Lock-In Period section on this page for details.
Small cap funds can add a growth-oriented component to a portfolio. However, their suitability depends on your risk tolerance, investment horizon, and overall portfolio mix.
Small cap mutual funds generally require a long-term perspective. Staying invested over multiple market cycles may help manage volatility and potentially capture growth opportunities.
These funds primarily invest in smaller companies with growth potential, while fund managers use research-driven strategies to select stocks. Portfolios may be diversified across industries, with active monitoring to make buy, hold, or sell decisions.
Investment timing can depend on your financial goals, market conditions, and risk appetite. Small cap funds may be more suitable as part of a long-term investment strategy rather than for short-term market timing.
Small cap funds are subject to market risks and can be more volatile than large cap or diversified funds. Investors should carefully assess their risk tolerance before investing.
Investors seeking long-term capital growth and comfortable with higher market volatility may consider small cap funds. It’s important to align investment choices with personal financial goals and risk appetite.
The minimum investment amount is Rs. 500 for lumpsum and SIP (minimum six instalments for SIP). It is advisable to check the fund’s official documents or consult the AMC for current up-to-date information.
Returns of small cap funds are market-linked and can fluctuate over time. Past performance may or may not be sustained in future.
When selecting a small cap fund, consider factors such as fund objectives, risk profile, past performance, fund manager experience, and alignment with your investment horizon.
Small cap funds may be part of a long-term investment strategy, but due to higher volatility, they may not be suitable as the sole instrument for retirement planning. Diversification is key.
Small cap funds generally require a long-term horizon to manage market fluctuations. A five-year period may or may not capture the full potential of the fund.
SIPs can help small cap fund investors manage volatility by spreading investments over time, which may reduce the impact of market timing. They also encourage disciplined, long-term investing and allow investors to build exposure to small caps gradually rather than through a lump-sum investment.
Small cap mutual funds are taxed like other equity-oriented mutual funds and there are no deductions or tax benefits. Long-term capital gains (on investments held for more than 12 months) are taxed at 12.5% on gains exceeding ₹1.25 lakh in a financial year, while short-term capital gains are taxed at 20%. IDCW, if opted for, is taxed in the investor’s hands as per their applicable income tax slab. Please note that these are base rates excluding applicable surcharge and tax. Staying invested for a minimum of one year and planning redemptions such that capital gains stay within the LTCG exemption limit may help reduce tax liability.
NRIs may invest in the fund, subject to applicable regulations and documentation. Eligibility may vary depending on country of residence and compliance requirements.
If you are KYC validated, you would typically need documents such as PAN, Aadhaar, and bank details (e.g., a cancelled cheque). If you are not KYC-validated, additional identity and/or address proofs may be required as per regulatory requirements.
The NAV is updated at the end of every business day based on the market value of the assets. The latest NAV is mentioned at the top of this scheme page.
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Our Investment Philosophy reflects what we, as an organisation, believe will generate a good return on equity investment for our investors in the long term. It dictates our goals and guides decision making.
Alpha (a) is a term used in investing to describe an investment strategy’s ability to beat the market.
Alpha is thus also often referred to as excess return or the abnormal rate of return in relation to a benchmark, when adjusted for risk. Essentially, it means doing better than the crowd without taking disproportionate risk.
Collecting superior information
Analysts and portfolio managers strive to collect superior information about the business and the management of the company. They try to generate superior earnings forecast and the balance strength of the company and the industry, thereby trying to 'beat the market' on information edge. This is an important source of alpha for an investor. However, over the years, retaining the information edge has become more difficult and expensive. With a whole lot of investors trying to collect superior information, how can an investor be sure to continuously have accurate and material information about the companies, ahead of others, all the time?
Processing information better
Even if you don't have material information earlier than the crowd, you can still generate better outcomes if you are able to process this information better. Investors develop models and algorithms with enhanced predictive powers to forecast the next move. Fund managers who invest based on some pure formal analytical models are quantitative managers. Here, the goal is to try and beat other investors based on the sophistication of procedures or analytics. The analytical edge can be quite useful until it gets copied by many, and then it may stop generating superior returns.
Exploiting behavioural biases
As the name suggests, this edge is achieved by superior behaviour in reacting to the inputs available to maximise alpha. Modern finance assumes people behave with extreme rationality. However, researchers in behavioural finance have shown that this is not true. Moreover, these deviations from rationality are often systematic. Behavioural managers try to exploit situations where securities are mispriced by the market because of behavioural factors. At Bajaj Finserv AMC, we endeavour to combine the best of these edges.
