DSP Mutual Fund to open DSP Small Cap Fund for lumpsum investments


DSP Mutual Fund has announced that the fund house would be revoking the temporary suspension of lumpsum investments in DSP Small Cap Fund with effect from April 1, 2020. From thereon, all lumpsum investments/subscriptions including all systematic investments in units of the Scheme shall be accepted, the fund house said in a press release.

DSP first restricted flows into the Scheme in October 2014 to Rs 2 lakh per investor as it felt that further large inflows into the Scheme may prove detrimental to the interest of the existing unit holders. In August 2016, DSP further restricted flows into the Scheme to Rs. 1 lakh per investor. The Scheme stopped fresh inflows altogether in February 2017. DSP opened the Scheme for subscriptions only through SIP/STP route on September 3rd, 2018.

“Small caps have very high volatility. The small cap index, for example has not made any returns for 13 years now, but in cycles intermittently good small businesses deliver good results. Thus, timing becomes very important. We would like to take money when we find the interest in the category to be very low, reflecting in cheaper valuations, yet keeping focus on quality of businesses,” said Kalpen Parekh, President, DSP Investment Managers.

“Over the last two years, the S&P BSE Small Cap TRI has fallen cumulatively by ~56%. We currently have the ability to invest in great businesses at attractive valuations thereby making the risk/reward proposition favorable at current valuations. Our process and philosophy in picking up stocks remains unchanged and we are confident of building a portfolio of good companies,” said Vinit Sambre, Head – Equities, DSP Investment Managers.

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