The right way to invest in mid-cap funds and small-cap funds with Rahul Singh

Zerodha Educate

24-10-2020 • 44 mins

One of the things that investors struggle with the most is with having the right expectations when investing and we've talked about this in the previous episodes as well. Mid-cap funds and small-cap funds tend to have higher returns than large-cap funds. But what most investors don't realize is that those higher returns come with a cost - that is higher risk or volatility. Most often than not, they just look at line charts comparing large-cap funds with mid and small-cap funds without looking at the deep and sharp drawdown and invest. If you look at the inflows and outflows of mid-cap and small-cap funds, you can clearly see that most retail investors tend to invest in these funds when they have already gone up and sell when they crash. So, in this conversation, I caught up with Rahul Singh, the Chief Investment Officer (CIO) of Equities at Tata Asset Management. In this conversation Rahul talks about:

  1. Whether the Indian markets are too small enough for good opportunities the nature of mid and small caps and how should investors think about them and allocate to them.
  2. His own investing philosophy and that of Tata Mutual Fund
  3. His thoughts on the current market phase
  4. Current market valuations
  5. International diversification
  6. Large-caps vs mid-caps.
  7. Is it the right time to invest in mid-caps and the case for investing in mid-caps and small-caps
  8. How to invest in mid-caps and small-caps
  9. His own investing philosophy
  10. Investing mistakes and lessons

Prateek Singh is the founder of LearnApp, an online learning platform with courses on investing, personal finance, trading and more, do check it out.