SBI Mutual Fund Announces discontinuation of lumpsum investments in SBI Small Cap Fund
   Sep 05, 2020

SBI Mutual Fund has announced that it will not accept lumpsum investments in SBI Small Cap Fund With effect from September 7, 2020.

However, the scheme will accept subscription only through the Systematic Route i.e. Systematic Investment Plan (SIP) of up to Rs 5,000 per investor.

With effect from March 31, 2020, SBI Mutual Fund had reopened the lumpsum subscription in SBI Small Cap Fund.

However, the fund house had put a limit of Rs 1,000 crore to the lumpsum inflows. Which means it would stop accepting lumpsum investment once the Rs 1,000 crore threshold is achieved.

Notably, the fund size has of scheme is now at around Rs 5,000 crore.

The fund house believes that the valuation of small cap stocks has risen because of the current rally. Considering the size constraints in managing a small cap fund, it has decided to stop lumpsum investments in the interest of investors.

Small caps being a high risk – high return investment segment, It is suitable only for aggressive investors having higher risk appetite.

Investors should consider their risk appetite while selecting funds in the small cap funds category.

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