Small-Cap Mutual Funds Halt Fresh Investments Amidst Market Volatility!!!

?Small-Cap Mutual Funds Halt Fresh Investments Amidst Market Volatility

Did you know that some small-cap equity fund houses have temporarily halted new investments ? Small-cap funds, which primarily invest around 65 percent of their portfolio in small-cap stocks with a market capitalization below 5000 crore or companies ranked 251 and above, are gaining attention. Currently, there are approximately 4813 small-cap stocks available in the market. Surprisingly, Three small-cap fund houses have decided to suspend new lump sum investments. But why did they make this decision, and which fund houses are affected? Moreover, what have been the average returns of small-cap funds so far, and how many funds are available in this category?

I have delved into the data and discovered that there are approximately 65 small-cap asset management companies in the market. Small-cap mutual funds have become quite intriguing lately. Over the past three years, the average returns of small-cap mutual funds have been around 39.38 percent, with the highest returns reaching an impressive 59.23 percent and the lowest at 26.23 percent. These figures may sound astonishing, but why have these fund houses halted new investments?

Considering the attractive returns of these funds, it seems counterintuitive to close the doors to potential business. So, what could be the reason behind this decision?

Let's explore this further. We are all aware of how mutual funds are managed by fund managers who seek potential growth? of our money. However, the current market scenario paints a different picture. With the Nifty 50 at 19,400 points and the Sensex reaching new highs at 66,000 points, the market appears to be overvalued and new? fresh investments are coming to the market especially for small caps around 5472 crore Rupees Investments in this last June end itsellf. The Nippon? small cap fund & Tata & SBI are funds which are paused the fresh Investments

??As per the? Dr. Pradiptarathi Panda, sir ? Assistant Professor at the National Institute of Securities Markets, states that it must be difficult for fund managers to find value stocks amidst this sharp market rise also considering the existing unitholder and returns in mind the managers and fund house have halted for fresh investment. The Buffet indicator for India is 96.11%, an early indication of over valued. In such circumstances, new investors may wait for potential opportunity and? It is always advisable to consult a SEBI-registered investment advisor before making any investment decisions.