
Disclaimer: The information provided in this article is for educational and informational purposes only. It should not be considered as investment advice or a recommendation to invest in any particular mutual fund or asset class. Past performance is not indicative of future results, and investors should conduct their research and consult with a financial advisor before making any investment decisions. Investing in mutual funds involves risks, including the possible loss of principal invested.
HDFC Small Cap Fund: Portfolio Composition
The fund exhibits a high-conviction approach with a focus on small-cap stocks:
- Equity Allocation: Constituting 91.28% of the portfolio.
- Debt Allocation: Nil, indicating a purely equity-centric strategy.
- Others: Comprising 8.72% of the portfolio.
Within equities, the fund has a diverse mix:
- Large Cap: 4.06%
- Mid Cap: 3.48%
- Small Cap: 66.7%
This composition underscores the fund manager’s inclination towards smaller companies with higher growth potential.
HDFC Small Cap Fund: Portfolio Turnover Ratio
The fund’s portfolio turnover ratio stands at 10.80%, significantly lower than the category average of 120.19%. This suggests that the fund manager adopts a more strategic and patient approach to portfolio management, potentially aiming for long-term capital appreciation rather than frequent trading.
HDFC Small Cap Fund: Growth over the years
1-Year Growth
HDFC Small Cap Fund has exhibited impressive growth over the past year, delivering a substantial return of 40.71%. This stellar performance outshines the category average, reflecting the fund’s ability to capitalize on small-cap opportunities in the market.
2-Year Growth
Over a two-year horizon, the HDFC Small Cap Fund has demonstrated remarkable resilience and growth, with returns soaring to 87.93%. The fund’s focus on small-cap stocks has proven to be fruitful, generating significant wealth for investors and outperforming both the category average and benchmark indices.
5-Year Growth
Long-term investors in HDFC Small Cap Fund have reaped substantial rewards, with the fund delivering an impressive return of 181.28% over the past five years. Despite the inherent volatility associated with small-cap investing, the fund has consistently outpaced its peers and benchmark indices, cementing its position as a top performer in the small-cap category.
HDFC Small Cap Fund: Top Holdings
The top 10 holdings of HDFC Small Cap Fund provide insight into its investment strategy:
- Firstsource Solutions Ltd. (4.19%): The fund has a significant stake in IT-enabled services, reflecting confidence in the sector’s growth prospects.
- Bank Of Baroda (4.06%): Exposure to the banking sector highlights the fund’s diversification across industries.
- Sonata Software Ltd. (3.30%): Investment in software & consulting signifies a bet on technology-driven growth opportunities.
- eClerx Services Ltd. (2.96%): The presence of business process outsourcing underlines the fund’s interest in niche service sectors.
- Aster DM Healthcare Ltd. (2.44%): Holding in the healthcare segment suggests exposure to defensive sectors alongside high-growth areas.
HDFC Small Cap Fund: Risk Ratios
Risk ratios provide insights into the fund’s risk-adjusted performance:
- Standard Deviation: With a standard deviation of 13.51, the fund exhibits high volatility compared to the category average of 12.9.
- Beta: A beta of 0.86 indicates slightly higher volatility than the category average of 0.8.
- Sharpe Ratio: A superior Sharpe ratio of 1.63 highlights the fund’s ability to generate better risk-adjusted returns compared to the category average of 1.47.
- Treynor’s Ratio: With a Treynor’s ratio of 0.26, the fund delivers better risk-adjusted returns relative to its market risk exposure.
- Jension’s Alpha: An alpha of 4.25 signifies significant outperformance compared to the benchmark, indicating the fund manager’s skill in generating excess returns.
HDFC Small Cap Fund stands out as a high-growth option suitable for investors seeking aggressive returns over the long term, backed by a well-diversified portfolio and strong risk-adjusted performance.
Disclaimer: The information provided in this article is for educational and informational purposes only. It should not be considered as investment advice or a recommendation to invest in any particular mutual fund or asset class. Past performance is not indicative of future results, and investors should conduct their own research and consult with a financial advisor before making any investment decisions. Investing in mutual funds involves risks, including the possible loss of principal invested.