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Best Small Cap Mutual Funds 2026

Small cap funds invest in companies beyond Top 250 according to average market capitalisation (Rs 10 Crore – Rs 500 Crore). Minimum investment in Equity & Equity-related instruments of Small-Cap companies is 65% of total assets.
Compare Funds
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Fund Name
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NAV (Rs.)
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AUM (Cr.)
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Returns Since
inception (%)
Returns
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Past
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Avg Rolling
 CAGR
Fund DeciZen
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P(%)
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Q
Bank of India Small Cap Fund(G)-Direct Plan
50.89 1,770
24.9
19 Dec' 18
-3.21
16.42
17.03
N/A
31.91
31.40
32.58
N/A
 cagr
31
Q
Edelweiss Small Cap Fund(G)-Direct Plan
46.61 5,108
23.9
07 Feb' 19
-1.16
16.16
16.7
N/A
30.00
29.84
31.00
N/A
 cagr
30
Q
Invesco India Smallcap Fund(G)-Direct Plan
45.07 9,208
22.4
30 Oct' 18
-0.05
20.14
18.97
N/A
28.55
29.40
30.27
N/A
 cagr
29
Q
Nippon India Small Cap Fund(G)-Direct Plan
181.12 61,809
23.5
01 Jan' 13
-2.15
17.27
19.91
17.4
25.42
25.78
24.54
24.57
 cagr
26
Q
HSBC Small Cap Fund(G)-Direct Plan
83.69 13,882
19.5
12 May' 14
-6.38
12.85
17.57
13.91
23.34
21.19
19.69
20.46
 cagr
21
Q
Tata Small Cap Fund(G)-Direct Plan
38.08 9,621
19.7
12 Nov' 18
-16.57
8.92
14.7
N/A
27.79
29.84
30.42
N/A
 cagr
30
Q
DSP Small Cap Fund(G)-Direct Plan
214.83 15,300
20.7
01 Jan' 13
2.68
17.33
17.22
13.08
20.56
21.96
20.08
20.19
 cagr
22
Q
HDFC Small Cap Fund(G)-Direct Plan
147.78 33,724
18.3
01 Jan' 13
-2.42
14.12
17.5
15.01
22.76
21.12
20.16
20.13
 cagr
21
Q
Franklin India Small Cap Fund(G)-Direct Plan
181.78 11,724
19.4
01 Jan' 13
-4.48
14.55
16.5
12.14
20.19
20.68
18.74
18.85
 cagr
21
Q
Bandhan Small Cap Fund(G)-Direct Plan
49.49 20,130
29.8
25 Feb' 20
-0.22
26.1
20.21
N/A
36.55
31.49
31.63
N/A
 cagr
31
Q
Canara Rob Small Cap Fund(G)-Direct Plan
40.81 11,603
21.7
15 Feb' 19
-2.47
12.49
16.75
N/A
29.89
29.78
30.78
N/A
 cagr
30
Q
ITI Small Cap Fund(G)-Direct Plan
30.60 2,493
19.9
17 Feb' 20
-1.93
20.57
14.86
N/A
30.20
26.89
25.60
N/A
 cagr
27
Q
SBI Small Cap Fund(G)-Direct Plan
184.70 32,286
22.3
01 Jan' 13
-5.93
10.63
13.03
15.3
21.79
23.88
23.26
23.33
 cagr
24
Q
UTI Small Cap Fund(G)-Direct Plan
26.09 4,164
19.8
22 Dec' 20
-4.3
14.28
14.71
N/A
20.23
21.90
19.43
N/A
 cagr
22
Q
Kotak Small Cap Fund(G)-Direct Plan
282.36 15,157
18.3
01 Jan' 13
-7.69
11.55
12.75
13.53
22.09
21.82
21.19
20.95
 cagr
22
Q
LIC MF Small Cap Fund(G)-Direct Plan
32.51 552
14.3
21 Jun' 17
-6.39
14.13
15.75
N/A
19.00
21.73
22.64
N/A
 cagr
22
Q
Axis Small Cap Fund(G)-Direct Plan
116.95 23,919
22
29 Nov' 13
-2.75
14.64
16.24
16.2
21.42
21.50
21.58
21.08
 cagr
22
Q
Quant Small Cap Fund(G)-direct Plan
264.30 25,821
16.7
07 Jan' 13
-4.27
16.72
21.45
18.12
26.20
21.50
21.09
19.77
 cagr
22
Q
Sundaram Small Cap Fund(G)-Direct Plan
282.45 2,983
17.1
02 Jan' 13
0.96
16.42
16.47
11.25
18.71
18.81
16.95
17.01
 cagr
19
Q
ICICI Pru Smallcap Fund(G)-Direct Plan
91.81 7,538
16.3
02 Jan' 13
-3.26
12.26
15.34
13.07
19.98
18.56
18.01
17.77
 cagr
19
Q
Aditya Birla SL Small Cap Fund(G)-Direct Plan
95.22 4,449
16
01 Jan' 13
0.74
15.48
12.36
9.09
18.13
17.33
15.49
15.64
 cagr
17
Q
Union Small Cap Fund(G)-Direct Plan
54.85 1,666
15.4
10 Jun' 14
5.84
17.37
16.44
14.11
18.76
17.31
17.57
16.72
 cagr
17
Q
Mahindra Manulife Small Cap Fund(G)-Direct Pla...
19.83 3,820
22.8
12 Dec' 22
0.12
20.47
N/A
N/A
28.29
24.79
N/A
N/A
 cagr
25
Q
PGIM India Small Cap Fund(G)-Direct Plan
16.59 1,353
11.3
29 Jul' 21
-0.28
11.78
N/A
N/A
13.50
15.33
N/A
N/A
 cagr
15
Q
The Wealth Company Small Cap Fund(G)-Direct Pl...
10.41 39
116.4
25 Mar' 26
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
 cagr
N/A
Q
Abakkus Small Cap Fund(G)-Direct Plan
10.52 453
98.4
17 Mar' 26
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
 cagr
N/A
Q
Quantum Small Cap Fund(G)-Direct Plan
12.44 181
9.4
03 Nov' 23
-0.55
N/A
N/A
N/A
7.83
N/A
N/A
N/A
 cagr
N/A
Q
Groww Small Cap Fund(G)-Direct Plan
10.33 209
17.4
29 Jan' 26
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
 cagr
N/A
Q
Samco Small Cap Fund(G)-Direct Plan
9.77 122
-6.3
04 Dec' 25
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
 cagr
N/A
Q
Bajaj Finserv Small Cap Fund(G)-Direct Plan
9.41 1,530
-7.8
18 Jul' 25
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
 cagr
N/A
Q
Mirae Asset Small Cap Fund(G)-Direct Plan
11.32 3,333
10.9
31 Jan' 25
2.42
N/A
N/A
N/A
13.38
N/A
N/A
N/A
 cagr
N/A
Q
Motilal Oswal Small Cap Fund(G)-Direct Plan
13.80 5,178
15
26 Dec' 23
-2.17
N/A
N/A
N/A
12.19
N/A
N/A
N/A
 cagr
N/A
Q
Helios Small Cap Fund(G)-Direct Plan
9.26 726
-18.5
27 Nov' 25
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
 cagr
N/A
Q
TRUSTMF Small Cap Fund(G)-Direct Plan
10.74 1,348
5.1
04 Nov' 24
4.3
N/A
N/A
N/A
11.28
N/A
N/A
N/A
 cagr
N/A
Q
Baroda BNP Paribas Small Cap Fund(G)-Direct Pl...
12.87 1,066
10.8
30 Oct' 23
-1.45
N/A
N/A
N/A
4.92
N/A
N/A
N/A
 cagr
N/A
Q
JM Small Cap Fund(G)-Direct Plan
9.33 560
-3.7
18 Jun' 24
-8.26
N/A
N/A
N/A
-1.88
N/A
N/A
N/A
 cagr
N/A
Q

Categories:

Flexi Cap Funds Large Cap Funds Mid Cap Funds Small Cap Funds Multi Cap Funds Large & Mid Cap Funds Tax Saver Funds Index Funds ETF Funds Nifty Midcap 50 Nifty Midcap Select Nifty Midcap 100 Nifty Smallcap 250 Nifty Smallcap 50 NIFTY Smallcap 100 Nifty Microcap 250 Nifty Largemidcap 250 Nifty500 Multicap 50:25:25

Fund House (AMC):

Aditya Birla Axis BNP Paribas DSP Franklin HDFC ICICI Bandhan Invesco Kotak L&T Mirae Motilal PPFAS Quantum Nippon SBI Sundaram Tata UTI NAVI

FAQs

Small Cap mutual funds invest a minimum of 65% of their portfolio in small cap companies. This includes companies with a market capitalization of less than 5000 Cr or the 251st company onwards, according to SEBI classification of market capitalization.

Only investors with a longer term time frame of more than 7 years should look to invest in Small cap mutual funds. Also, remember all your small-mid cap investment put together should not be more than 20-30% of your portfolio.

For details read, 'How to achieve the right diversification in Mutual Funds?'

Once you login to your profile, MoneyWorks4me's Decision Maker provides you all the key info necessary to help you make an informed decision.

Funds that hold a reasonable proportion of good quality companies are colour coded Green, while those with a higher percentage of companies marked as "risky" are shown in RED. Similarly, funds with a good return consistency are indicated as Green, while those with poor return consistency are coded Red.

More info in the video below:

Fund Name Nav (Rs.) AUM (Cr.) Returns Since Inception Past Returns 5 Yr Avg Rolling Returns Quality Performance
SBI Small Cap Fund 75.93 6,594 19.4 19.63 24.29 Risky Very Good
Nippon India Small Cap Fund 54.76 10,637 17.8 17.63 22.94 Risky Very Good
DSP Small Cap Fund 74.20 5,812 15.8 13.56 20.21 Risky Very Good
Franklin India Smaller Companies Fund 64.50 6,216 13.2 11.79 17.02 Risky Very Good
HDFC Small Cap Fund 51.34 9,069 13.6 15.88 15.65 Risky Somewhat Good
Aditya Birla Sun Life Small Cap Fund 39.49 2,310 10.5 11.07 15.03 Risky Very Good
Sundaram Small Cap Fund 99.79 1,208 15.5 9.44 14.05 Risky Not Good
Kotak Small Cap Fund 110.56 2,539 16.2 17.65 13.93 Risky Very Good
AXIS Small Cap Fund 42.08 3,632 22.1 17.38 13.60 Risky Somewhat Good
ICICI Prudential Smallcap Fund 35.08 1,778 9.91 13.89 12.74 Risky Not Good

Capital gains received within a one-year holding a mutual fund is known as short-term capital gains or STCG, which is taxed at a rate of 15 per cent. Long-term capital gains (LTCG), or a capital gains realised after a holding period of over a year, are exempt up to an amount of Rs 1 lakh. Over Rs 1 lakh, the gains will be taxed at 10 per cent.

Advantages:
  1. High Returns: Small cap companies have higher growth potential than their mid/large cap counterparts. High growth often translates to higher stock price appreciation.
  2. Relatively Low Risk: Investing in small cap fund is a very good method to gain exposure to the space without taking on the risk of investing in individual stocks.
  3. Professional help: Experienced fund managers managing your money further reduce the chances of you losing your hard earned money.
Disadvantages:
  1. Volatility: Small cap funds come with a certain risk owing to its highly volatile nature. This is in contrast to large cap or multi cap funds that are relatively more stable.
  2. Long periods of underperformance: Small cap stocks and thereby the funds that own them too are often plagued with long periods of underperformance.

MoneyWorks4me empowers retail investors to find the right Small Cap Mutual Fund best suited for your portfolio, all through its amazing free features. So register now at MoneyWorks4me.com

Every fund is assessed on the following:
  1. Consistent Outperformers : Track record of having generated returns above a benchmark on a 3-year rolling basis. Consistent performers are Green, followed by Orange. Red have an inconsistent track record on outperforming the index.
  2. The average 3-year rolling returns number appears in the first button.
  3. Quality of Portfolio is assessed based on the quality of each stock held. Predominantly high quality stocks get a Green second button, followed by Orange and Red (large amount of risky stocks).
  4. Upside Potential: Every fund is assessed on what returns it could deliver in the next 5 years based on it.

Select the fund that is Green on Performance which shows it has consistently outperformed the index. Select one with a high average 3-year rolling returns - the number in the first button. And select one with a Green rating on Quality-the second button.

Use the Funds Screener and select the category. It shows the funds with Green on Performance and Quality right on the top. The ones with the higher average 3-year rolling returns are ranked the highest. Funds with less than 5 years returns history are colored Grey on Performance. Since the track record is not for an adequately long period they feature lower in the list.

Build a well-diversified portfolio with funds that assures you of a stable growth through market and economic cycles and funds that enhance your portfolio returns over the long run.
  1. Core Funds: Choose from Large cap, Large and Mid cap and Flexicap funds.
  2. Booster Funds
    1. Choose from Mid and Small cap funds.
    2. Select a Sector or Thematic Fund that is likely to outperform in the long term.

Use the Fund Portfolio Analyzer, Sher-ya-Billi to check if your portfolio will deliver healthy returns or disappoint you. Go to Fund Portfolio Analyzer. You can also upload details of your funds in the Portfolio Manager and see the report on this page.

When adding a new fund check how different is the fund compared to your portfolio by using the link in the Right allocation box on the Fund Decision Maker.

Most investors have more, many more funds that they should-over diversified. This tends to reduce returns. Many investors have more of the same i.e. they have funds that have very similar portfolios and hence the fund portfolio is not well-diversified. Either there are too many large cap dominated funds or far too many mid and small cap funds. What you require is a good, balanced mix. Finally investors don't know when to exit a fund and end up carrying it even though the future upside potential is very low.
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About MoneyWorks4Me

MoneyWorks4Me is a SEBI-registered Investment Adviser (IA) dedicated to helping investors build long-term wealth through transparent, research-driven, conflict-free guidance. Founded in 2008, we started our journey as a Research Analyst (RA), providing deep fundamental analysis, intrinsic value insights, and long-term investing frameworks for Indian equities. In 2017, we transitioned to a full-fledged SEBI-registered Investment Adviser, strengthening our commitment to acting as a fiduciary—always putting the investor’s interest first.

Our Vision

To become India’s most trusted, research-powered fiduciary advisory platform—where every investor, regardless of experience, can make calm, confident, and well-reasoned investment decisions.

What Makes MoneyWorks4Me Different

  • Fiduciary-first advisory model.
    As SEBI-registered IAs, we are legally and ethically bound to act in the best interests of our clients. We do not sell or distribute any financial products. This ensures our guidance is 100% unbiased and conflict-free.
  • Deep fundamental research + robust valuation discipline.
    Built on more than 15 years of equity research, our framework combines quality assessment, intrinsic value estimation, and a sensible margin-of-safety approach.
  • Process—not predictions.
    We don’t rely on guesswork or market timing. Instead, we focus on asset allocation, risk management, and long-term compounding.
  • Technology + Human Intelligence.
    We believe a combination of both is essential for investing success. We constantly innovate and upgrade in-house tools, financial X-rays, and portfolio analytics so that our team of analysts and advisors are equipped with the best.
  • Partner with Clients.
    We follow a DIWM (Do-It-With-Me) approach where we partner clients in setting goals, financial planning, educating on our investing process and share decision-enabling resources transparently with our clients who retain control on execution.

Our Approach: Ensuring compounding work its magic on client portfolio.

MoneyWorks4Me ensures this through:

  • Investing in stocks, mutual funds, debt, and gold
  • Quality-at-Reasonable-Price way of investing in stocks
  • Constructing Direct Stock Portfolios with Core, Booster, and Amplifier stocks
  • A Mutual Fund Portfolio that delivers consistent out-performance and meaningful diversification (low overlap)
  • Periodic review and rebalancing
  • Clear Buy-Sell-Hold, and Position-sizing frameworks
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