JP Morgan India Mid and Small Cap Fund

JP Morgan India Mid and Small Cap Fund

AUM Rs 112.3 CRORE.................................................................... AS ON MARCH 31, 2014

NAV Rs 14.15............................................................................................. AS ON JUNE 9, 2014

The performance of mid -caps and small-caps are the talk of the streets nowadays. With improving business sentiment, these two segments are thumping ahead at a fiery pace. To substantiate the fact, the BSE mid-cap and BSE small-cap indices have moved up by 27.62 per cent and 19.36 per cent respectively since May 16, 2014 as against a 5.41 per cent up move by the Sensex. Although considered to be risky, these indices give the investors an opportunity to garner some heft y gains. However, there are investors who shun away from direct equity investments and in turn prefer the mutual fund route to invest in the capital markets. Here we present to you, JP Morgan India Mid and Small cap Fund which will help you to reap in benefits if you are willing to take some amount of risks.

Managed by Harshad Patwardhan since November 2007 and Amit Gadgil since February 2008, the scheme aims to generate long term capital appreciation from a portfolio that is substantially constituted of equity and equity related securities focused on smaller companies. Over the past three years, this fund has established itself as a good performer in both bull and bear phases of the market in an otherwise risky category. The fund’s mandate is to invest in smaller companies with the investment universe being companies constituting the bottom fourth by way of market capitalization of stocks listed on the NSE or BSE. Quality stock selection and investment discipline are indicators, making this fund a good choice to invest in.

Looking at the scheme portfolio, the top five sectors constitute 82.69 per cent of the portfolio. The top five sectors are viz. Financial (25.49 per cent), Engineering (16.29 per cent), Automobile (14.55 per cent), Construction (14.28 per cent) and Services (12.08 per cent). This sectoral asset allocation clearly exhibits that the tilt is towards cyclical sectors which have once again come into the limelight post elections. The top five stocks that form part of portfolio are Motherson  Sumi Systems (4.32 per cent), Adani Ports & SEZ (4.12 per cent), Eicher Motors (3.70 per cent), Bharat Forge (3.51 per cent) and Shree Cement (2.98 per cent). Out of 62 companies that form a part of its portfolio, mid-cap and small-cap companies constitute 83.27 per cent of the AUM while the rest is held by exposure to large-cap stocks.

The improved performance of the fund has not come at the cost of risk taking. This statement can be substantiated by looking at the sharp ratio which stands at 0.60. The alpha of the fund stands at 8.97, which represents the excess return that the fund has generated at a given level of risk. The fund can be an ideal candidate to form a part of the mutual fund portfolio of risk taking as well as risk adverse investors. However, SIP route for investors seems to be the best way to invest in this fund scheme.