Small & mid-cap funds: Which investment strategies can help you maximise returns during market selloff

Recently, there has been a lot of attention paid to mid- and small-cap funds. Veteran fund manager S. Naren’s remarks have sparked a significant discussion on SIPs, particularly with regards to short-term investments in small and midcap funds. Many average investors see these funds as a great way to balance risk and return on their equity exposure.

During the IFA Galaxy 2025 event, S. Naren cautioned about the risks associated with small and midcap SIPs. He also pointed out the challenges fund managers face in balancing investment rationale with sales team pressure and business dynamics.

Naren emphasized the high valuations in these sectors, with median price-to-earnings ratios for mid- and smallcap stocks standing at 43. Market…

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