Before getting into the best and not so best mutual fund investments, let’s go through some different kinds of mutual fund investments that are small or large-cap mutual funds and also how the investors are going to decide on that.
What are small-cap mutual funds?
The funds that are invested in companies that are below the top 250 stocks, in the exchange as per the capitalization of the market are called small-cap mutual funds. The returns are quite high as per the other options.
Before taking this up just because of its high returns should not be done and the investors are suggested to check on the risk factors as all the mutual funds are liable to some risk factors. So before going for these small-cap mutual funds, the following factors should be kept in mind for the investor:
How to invest in small-cap mutual funds?
Nowadays, everything has become digital to make everyone calmly sit at home and do the needful. Investing in Small Cap Funds is a very simple and hassle-free process that everyone can easily follow. Please follow these steps below:
Let’s now see, the top 5 best small-cap funds that one can go for! Here, we will also show you the returns for 3 years and 5 years that each one gives.
Return on investment for 3 years- 7.62%
Return on investment for 5 years- 13.06%
Return on investment for 3 years- 15.29%%
Return on investment for 5 years- 14.79%
Return on investment for 3 years- 1.33%
Return on investment for 5 years- 8.75%
Return on investment for 3 years- 3.58%
Return on investment for 5 years- 10.21%
Return on investment for 3 years- 5.75%
Return on investment for 5 years- 9.13%
What are large-cap mutual funds?
Based on market capitalization, mutual funds are divided into 3 types of small-cap mutual funds, mid-cap mutual funds and large-cap mutual funds. Funds that invest more of their parts in companies that have big market capitalization are known as large-cap mutual funds. They also provide a good return on investments for its investors with very fewer risk factors.
Let’s discuss some benefits of investing in large-cap mutual funds:
Now let’s focus on the top 5 best large-cap mutual funds. Here, we will also show you the return on investment for 1 year.
Return on investment for 1 year- 3.7%
Return on investment for 1 year- 6.0%
Return on investment for 1 year- 6.8%
Return on investment for 1 year- 11.8%
Return on investment for 1 year- 7.8%
In simple words, investors who are planning to invest their money and are ready to take some risks to get high returns should go for small-cap mutual funds. These funds do offer high returns when the market is going good, but when the market faces a downfall, these funds can be highly affected and that’s when the risk factor comes into being.