Multicap mantra

[drsambu123]

Dear friends
Just i checked the long term performance of various category MFs. Now Value research online has changed their fund classification( they divided equity diversified into large cap. large and midcap, multicap etc)
Long term performance of multicap funds are much superior than large or large and midcap. To compare with mid and small cap only few mid and small cap available for 10 year period(like rel.growth) and their performance also good.
So multicap MFs may be superior to large or large and midcap category?????....
Expert opinions please...

To compare
Multicap long term performance
http://www.valueresearchonline.com/funds/h2_typecomp.asp?mode=performancelong&Type=1&objective=10
large cap
http://www.valueresearchonline.com/funds/h2_typecomp.asp?mode=performancelong&Type=1&objective=8
Large and mid cap
http://www.valueresearchonline.com/funds/h2_typecomp.asp?mode=performancelong&Type=1&objective=9
Mid and small
http://www.valueresearchonline.com/funds/h2_typecomp.asp?mode=performancelong&Type=1&objective=11

 

[lonsharim]

Its not surprising to see these funds do better than funds that focus on large or mid/small caps. These funds have better balance. Most people investing in multiple funds are also advised to position themselves similarly i.e 60% in Large cap and 40% - in mid/small because it gives you relative comfort. If your risk appetite is more then you could invert those percentages during a bullish phase.

In the worst of times these funds don't lose as much as others and in the best of times they will not necessarily out perform mid/small cap fund performances. Your links show in the long run its better to balance, but its not just because of long term value to the investor, its also because they provide better stability.

 

[drsambu123]

Its not surprising to see these funds do better than funds that focus on large or mid/small caps. These funds have better balance. Most people investing in multiple funds are also advised to position themselves similarly i.e 60% in Large cap and 40% - in mid/small because it gives you relative comfort. If your risk appetite is more then you could invert those percentages during a bullish phase.

In the worst of times these funds don't lose as much as others and in the best of times they will not necessarily out perform mid/small cap fund performances. Your links show in the long run its better to balance, but its not just because of long term value to the investor, its also because they provide better stability.

Yes. u r right. Even in multicap funds, some are large cap oriented and some are large and midcap oriented.. (which keep varying from time to time.) So we can choose the allocation based on our risk profile like 60=40 or 70=30

 

[yodlee99]

The other name for multi-cap is Flexi-cap. It is completely upto the fund manager, whether it holds more of large than mid&small cap stocks at any point of time, or vice versa. For this very reason, every AMC has a multi-cap and these are consistent earners in long term.