Multi-cap funds offer a diversified approach by investing in stocks across various market capitalizations, including large cap, mid cap, and small cap stocks. This flexibility allows fund managers to tap into opportunities in different segments of the market. By diversifying across market capitalisations, multi cap funds aim to combine the growth potential of smaller companies with the relative stability of large caps.
Mutual funds follow specific requirements based on the fund category. For instance, large cap funds need to invest predominantly in the top 100 companies by market capitalization, while small cap funds focus on smaller companies.
Multi cap funds, on the other hand, can invest across large cap, mid cap, and small cap stocks, maintaining a minimum 25% allocation to each. This gives them exposure to varying opportunities in each category in different market conditions.
Bajaj Finserv Multi Cap Fund - Regular & Direct Plans
When you invest in the Bajaj Finserv Multi Cap Fund, you can choose between two types of plans: Direct Plan and Regular Plan. Both follow the same investment strategy, but the way you invest and the expense ratio you pay differs.
Direct Plan
With this route, investors transact directly with the asset management company, without involving a distributor. Since there are no commission costs, the expense ratio is lower. It can be suitable for informed investors who want to independently create and manage their portfolio.
Regular Plan
Here, you invest through a distributor, who assists you with the fund selection and investment process. For this, the fund charges a commission fee in its expense ratio. This means the expense ratio is a bit higher than in the direct plan. However, it also means you get tailored fund recommendations based on your goals and risk appetite. The distributor also helps you with the investments redemptions and other processes.
The bottom line
Both plans invest in the same portfolio of stocks. The difference is in how you invest – a do-it-yourself approach or with guidance – and the cost you incur.
How to invest in Bajaj Finserv Multi Cap Fund
You can invest in Bajaj Finserv Multi Cap Fund either online or offline.
Offline mode: You can fill out the application form and submit it at any of the AMC's official points of acceptance (OPATs). If you are taking the help of a distributor, they may help you fill the form and submit it on your behalf.
Online Mode: You can invest through your Demat account. You can also go to Bajaj Finserv AMC’s investor portal. Create an online account, select the Bajaj Finserv Multi Cap Fund, and initiate an SIP or lumpsum. Invest now.
Taxation on Bajaj Finserv Multi Cap Fund
Bajaj Finserv Multi Cap Fund is an equity mutual fund, so it follows the tax rules applicable to equity-oriented schemes. The tax you pay depends on how long you stay invested.
Short-term capital gains (STCG): If you redeem your units within 12 months of purchase, any gains are classified as short-term and taxed at 20%, along with applicable surcharge and cess.
Long-term capital gains (LTCG): If you stay invested for more than a year, your gains are considered long-term. Gains up to ₹1.25 lakh in a financial year are exempt from tax. Any gains above that are taxed at 12.5%, plus surcharge and cess as applicable.
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