If taking risks with investing is up your street, the following five funds are what you should consider. They will post very high returns, but also run the risk of falling sharply when the stock markets move adversely. Investments by these funds are mostly into mid and small-cap companies, which have the potential to become the big companies in future. Do track the performance of these funds closely, because they do take tactical calls based on market and economic developments which impact their performance immensely.
Axis Long Term Equity
A little over 7 years old, the fund has been a consistent performer since its launch. That it is an ELSS is an additional advantage that works in the fund’s favour, which investors could use to not just save on taxes, but also to build wealth. Such has been its performance that it could put several diversified equity funds’ performance to shame.
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DSPBR Micro Cap
The fund has been a pioneer in venturing into the very small-cap or micro-cap space. In nearly a decade since its launch, the fund has done exceedingly well, despite the risks involved in managing such a fund. Your patience to stay invested for the long term will pay off with this fund.
HDFC Mid-Cap Opportunities
Consistency has been a unique characteristic of this fund across market cycles, which makes it a valuable investment option. About 75 per cent allocation to mid-caps is risky, but the fund manager has handled market swings to come unscathed from time to time. A clear stock picking filter, further adds to consistency.
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ICICI Pru Value Discovery
This fund follows a value-focussed approach to investing with a significant tilt towards large cap stocks. Although, the fund does not follow any defined market capitalisation allocation, it follows a contrarian approach by avoiding investments in over-fancied stocks and sectors. Not for the faint hearted, but those willing to take the risk will reap the rewards.
Sundaram Select Midcap
The scheme achieves capital appreciation by investing in mid-cap stocks using a very well defined filter that opens up its investment universe. The fund manager actively takes sector calls, which makes the investments risky, but worth the risk if one can stay invested for some years to benefit from the upside and book profits.
