Small cap funds invest in companies outside India’s 250 largest, where price swings are sharper and long stretches of strong returns are often followed by deep falls. That makes a single point-to-point return especially misleading in this category: the same fund can look outstanding or disappointing depending on whether the period starts before or after a small cap correction.
The table below compares Small Cap direct plans on their average 3-year and 5-year rolling returns and on how often those holding periods ended negative. Rolling returns look at every completed holding period in a fund’s history instead of just one, which reduces the date-picking effect. This is a comparison and education tool, not a recommendation to buy or sell any fund.
How to Read This Table
- #: the fund’s rank by the Avg column. Gold badges mark ranks 1 to 5. The rank stays with the fund when you re-sort.
- 3Y Rolling / 5Y Rolling: the average annualised return across all completed 3-year and 5-year windows.
- Avg: the ranking metric, the average of the 3Y and 5Y rolling returns.
- 3Y Neg % / 5Y Neg %: the share of windows that ended with a negative return. Lower means fewer losing periods in that fund’s history.
- Sorting: click any column header to sort. The default order is Avg, highest first.
- Data last refreshed: the figures move mainly when a new calendar month completes, because the windows are built on month-end NAVs.
What the Negative-Period % Tells You
The negative-period percentage shows how often a holding period of that length ended below zero in the fund’s own history. In small caps this column deserves extra attention, because even 3-year holding periods have ended in losses during extended market corrections.
It is a lens, not a rule. A 0% figure does not mean a fund cannot lose money; it only means no completed window in the observed history ended negative. Funds with shorter histories have fewer windows and may not have been through a full small cap downturn, so their percentage rests on less evidence. Read it together with the return columns and the fund’s history length.
Why Rolling Returns Matter for Small Cap Funds
Small cap returns tend to arrive in bursts. A strong rally can lift a fund’s 3-year or 5-year CAGR sharply, and a correction can pull it down just as fast. A single CAGR figure captures only one of these phases, depending on the dates chosen. Rolling returns cover every entry point in a fund’s history, including those that started near market peaks.
The gap between the 3Y and 5Y rolling returns, and between the average and the negative-period percentage, also says something about the ride. Two funds with similar averages can reach them very differently: one with steadier results across windows, the other with high highs and more losing periods.
Fund size matters more here than in larger categories. Small cap stocks trade in lower volumes, so a fund that grows very large may find it harder to buy and sell positions without moving prices. Past rolling returns earned when a fund was much smaller may not reflect the conditions it operates in today.
What Is a Rolling Return?
A rolling return measures a fund’s annualised (CAGR) return over a fixed holding period, such as 3 years, and then repeats the measurement as the start date moves forward. Each measurement is one “window”.
For example, a 3-year rolling return looks at Jan 2020 to Jan 2023, then Feb 2020 to Feb 2023, then Mar 2020 to Mar 2023, and so on until the latest date. Averaging all those windows shows what a typical 3-year holding period delivered.
A single point-to-point CAGR depends entirely on the two dates chosen. Start just after a market fall and it looks excellent; start just before one and it looks poor. Rolling returns replace that one snapshot with a full set of outcomes. For point-to-point figures, see our mutual fund CAGR returns hub.
How We Calculate and Select Funds
Calculation
For each fund we take the month-end NAV (the last available NAV on or before each month-end) from launch onward.
- Start with the first month-end and measure the CAGR to the month-end exactly 3 years (or 5 years) later.
- Move the start forward by one month and measure again. Repeat until the latest completed month.
- Average all the windows to get the fund’s 3Y or 5Y rolling return.
CAGR for each window = (End NAV / Start NAV) ^ (1 / years) – 1. As an illustration only, a NAV that grows from 100 to 200 over 3 years is a CAGR of about 26% a year. We also compute the percentage of windows with a negative return, shown as 3Y Neg % and 5Y Neg %.
Fund Selection
- Category: Small Cap funds only, as classified under SEBI’s scheme categorisation.
- Plan type: Direct plans, Growth option only. Index funds and ETFs are excluded.
- Minimum history: at least 5 years of NAV history under the fund’s current scheme code.
- Same pool for both windows: a fund must qualify for both the 3Y and 5Y calculation, so no fund appears in one and not the other.
- Ranking: (3Y rolling return + 5Y rolling return) / 2; the ten highest are shown.
- Merged or renamed schemes: each fund is measured on its own continuous NAV history under its current scheme code.
- Data source: AMFI NAV data via mfapi.in, refreshed automatically every day.
Limitations of This Comparison
- Past performance: rolling returns describe what happened, not what will happen.
- Falls within a window are not shown: each window measures only its start and end NAV. A window can end positive even if the fund fell sharply in between, and small cap funds can see large temporary falls.
- Different history lengths: a newer fund is averaged over fewer windows from more recent market phases, while an older fund covers more cycles, including past small cap corrections.
- Survivorship: only funds that exist today with enough history are shown; merged or closed funds are not included.
- Returns only: the table does not capture risk-adjusted performance, expense ratio, portfolio liquidity, fund size, taxation or fund manager changes.
Things to Check Before Making Any Decision
- Expense ratio of the direct plan and how it compares with peers.
- Fund size (AUM) and whether the fund has placed any limits on fresh or lump sum investments.
- The stress test disclosure published by the AMC, which shows how long the fund would take to sell part of its portfolio.
- The scheme’s riskometer and concentration in top holdings.
- Exit load and the tax rules that apply to your holding period.
- Whether you could stay invested through a fall of 40% or more, and whether the scheme’s risk suits your time horizon.
Frequently Asked Questions
What counts as a small cap company?
Under SEBI rules, small cap companies are those ranked 251st onwards by full market capitalisation, based on the list AMFI updates every six months. Small cap funds must keep at least 65% of their assets in these companies.
Why do small cap funds show more negative rolling periods?
Small cap stocks tend to rise and fall more sharply than larger companies, and corrections in this segment have sometimes lasted long enough for full 3-year holding periods to end below zero. Longer 5-year windows usually show fewer negative periods, but that is an observation from past data, not a certainty.
Why is the Avg column used for ranking?
Averaging the 3Y and 5Y rolling returns gives equal weight to both holding periods, so a fund cannot rank highly on the strength of just one period length.
Why are some Small Cap funds not in the table?
Only direct Growth plans with at least 5 years of NAV history under their current scheme code are included, and index funds and ETFs are excluded. Funds that are newer, or whose available NAV history is incomplete, are left out until they have enough data.
Compare Rolling Returns in Other Categories
- Large Cap Funds Rolling Returns
- Mid Cap Funds Rolling Returns
- Flexi Cap Funds Rolling Returns
- All Mutual Fund Rolling Returns
Disclaimer: Mutual fund investments are subject to market risks. Read all scheme-related documents carefully. Past performance may or may not be sustained in the future.
This page is for education and information only. It is a comparison of historical data and is not investment advice, a recommendation, or an offer to buy or sell any mutual fund scheme. Please consult a SEBI-registered investment adviser before making investment decisions.