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Edelweiss Insights Edelweiss MF launches Edelweiss Small Cap Fund

Edelweiss MF launches Edelweiss Small Cap Fund

NFO will be open for subscription from January 18, 2019 to February 01, 2019.
Team Cafemutual Jan 18, 2019

Edelweiss Mutual Fund has launched Edelweiss Small Cap Fund, an open-ended scheme predominantly investing in small cap stocks.

Harshad Patwardhan, CIO – Equities, Edelweiss MF will manage this fund.

In a press release, Radhika Gupta, CEO, Edelweiss MF said, “Investing in small caps can be rewarding when last one year returns are negative, but underlying earnings are picking-up. We believe our experience in successfully managing our midcap fund over the last 10 years through bottom-up stock picking will help in identifying opportunities in the small cap segment for our customers.”

The fund house said, “Currently, small-cap index is down over 28% in last one year and thus may be a good time to invest in this category. Investment in small-caps generate relatively higher alpha – quality small cap outperform as they show stronger earnings growth compared to large caps. Small-caps also provides fund manager a wider basket to invest, over 2500 stocks are available in small-cap segment across many unique sectors not covered by large caps.

Somewhat similar to STP, the fund house offers a new facility called Smart Trigger enabled Plan (STEP), which helps an investor to invest in a staggered manner and mitigate market timing risk. This feature is available only during the NFO. Through this facility, investors can spread their investment in Edelweiss Small Cap Fund in 5 equal monthly instalments. Under this feature, 20% of the application money will be invested upfront in the fund. The remaining 80% will be invested in Edelweiss Liquid Fund and will switch to Edelweiss Small Cap Fund in 4 equal monthly instalments triggered by market dips.

Radhika said, “Since small-caps are volatile, we want investors to invest systematically using the STeP facility during the NFO period which can help mitigate market timing risk”.

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