Samco Small Cap Fund - Direct Growth

Small Cap companies are the 251^st-750^th companies in terms of market capitalization. Small Cap Funds are those equity-oriented mutual funds that invest primarily in small cap companies.

It is a strategy to invest in winning stocks which are showing strong momentum. Momentum stocks are such that exhibit positive price momentum – based on the phenomenon that stocks which have performed well in the past relative to other stocks (winners) continue to perform well in the future, and stocks that have performed relatively poorly (losers) continue to perform poorly. The momentum strategy is based on buy high, sell higher or alternatively, cut your losses and let your winners run.

Momentum works due to behaviour biases of the investors in the financial markets. Investors are not always rational, they have limits to their control over emotions and are influenced by their own biases such as loss aversion, regret, anchoring and disposition biases. Because of all these human biases, there exists an opportunity in the momentum space which is more consistent and time-tested strategy to make an alpha in the stock market.

Samco Small Cap Fund uses a cutting-edge momentum-based strategy with SAMCO's proprietary C.A.R.E. Momentum system to deliver superior risk-adjusted returns. It identifies small cap stocks with strong momentum in Cross Sectional, Absolute, Revenue, and Earnings Momentum. These parameters ensure that the portfolio remains optimized by focusing on small cap stocks from the companies ranked beyond 250+ by market capitalization, as defined by the AMFI, that exhibit robust momentum traits. The Investment universe of the fund shall primarily be focused on Universe of companies from Market cap Rank 251 – 750. This will allow the fund to also build exposure to small caps beyond the NIFTY500 Universe.

Samco Small Cap Fund uses C.A.R.E Momentum Strategy which invests in small cap stocks that are showing momentum characteristics in Cross Sectional, Absolute, Revenue, and Earnings Momentum to deliver superior risk-adjusted returns. The fund will invest between 65%-100% of assets in companies beyond rank 250+ by market capitalisation, also referred to as Small cap companies. The fund also has the flexibility to invest 0-35% of assets in companies other than small caps or international stocks or in debt/money market instruments. The scheme may use derivatives instruments for purposes of hedging up to 80% of net assets and shall not exceed 50% of net assets for other than hedging purposes.

The minimum investment amount for lumpsum is Rs.5,000 and in multiples of ₹1/- thereafter and for Systematic Investment Plan (SIP) it is Rs. 500 and in multiples of ₹1/- thereafter.

There is no entry load applicable. 10% of units can be redeemed at any time without an exit load. Any redemption in excess of 10% of units will incur 1% exit load in the first 12 months. No exit load, if redeemed after 12 months from the date of allotment of unit.

The fund will be jointly managed by Mr. Umeshkumar Mehta, Mrs. Nirali Bhansali, Mr. Dhawal Ghanshyam Dhanani and Mr. Vishal Shinde.

The benchmark for this scheme is the Nifty Smallcap 250 Total Returns Index.