Being a consistent performer for many years, Reliance Multi Cap Fund has shown shattering performance in the past two years. Many investors are confused with the long-term investment in the fund. Thus, the financial analysts of MySIPonline have researched about the fund, its returns, investment strategies, whose details have been provided in the write-up further.
Necessary Information About Reliance Multi Cap Fund (G):
Launched in the year 2005, the fund was earlier known as Reliance Equity Opportunities Fund. Currently, it has an AUM of Rs 9,732 Cr as on Jul 31, 2018, with an expense ratio of 2.00%. Investing across the market cap, it predominantly allocates the assets in equity and equity-linked derivatives. A little amount of corpus is also invested in debt instruments to keep the mandate liquidity in the portfolio.
The average market capitalisation of Reliance Multi Cap is Rs 38,036.02 Cr as on Aug 18, 2018. This capital is invested in 54 companies, keeping most of the corpus in financial, services, engineering, and construction sector. The other industries where the fund is investing in its corpus are healthcare, energy, FMCG, and automobile sectors.
Risk and Returns of Reliance Multi Cap Growth Plan:
The fund has provided the returns of 18.07% since its launch, beating its benchmark, S&P BSE 500 (TRI) as well as the category’s average. In the past 10 years from 2008 to 2018, the fund has provided the returns of 13.4%. If a person invested the amount of Rs 10,000 in 2008, it has been compounded to Rs 38,180 in 2018. While the same amount invest in benchmark has provided the returns of Rs 19,280 in the same period, i.e., 6.8% of returns. This all shows that the fund has performed better than its benchmark as well as its peers in the past 10 years.
A multi-cap scheme, Reliance Multi Cap is investing 40% in large-cap, 35% in mid-cap and 17% in small-cap companies. The fund is not biased towards any market cap and invests in the high growth companies, providing more exposure to mid and small-cap companies than its peers. Thus, it is a moderate risk fund offering the good returns to investors in the long run. Therefore, as per financial analysts of MYSIPonline, investors who want the returns of 12-14% as well as a diversified portfolio, shall invest in the fund.
Strategies Followed by Reliance Multi Cap Fund:
The fund has been managed by Mr Sailesh Raj Bhan, and he follows the free-flowing approach of selecting the stock. He provides the exposure to the quality mid-cap companies, who have scalable growth and credibility. He selects the models that help the fund in generating excellent alpha over long-term. He invests in emerging small-cap businesses providing tilt towards value companies. Mr Bhan also takes the thematic bets, if he feels that a sector will be going to perform well in the coming years.
As per the financial analysts of MySIPonline, a short-term downturn of Reliance Multi-Cap Fund growth will not affect the returns provided by it in the long run. If investors have the long-term investment perspective, then they should stay invested in the scheme.
