Several mutual fund advisors are asking their clients to split their investments between largecap, midcap and smallcap schemes than investing the entire corpus in a multicap or diversified equity schemes. "Funds which have focus on specific caps, tend to perform better," says Vishal Ramaswamy, a mutual fund advisor based in Mumbai.
Multicap or diversified schemes are supposed to invest across stocks in different market capitalisation based on the view of the fund manager. The allocation to each marketcap varies from scheme to scheme. Some schemes have a fixed proportion and some change it dynamically depending on the market conditions.
