DSP BlackRock Micro Cap Reg G- for gaining that extra edge

Investors with an appetite for taking risks and willing to experience the extreme volatility that small cap investing can introduce to ones portfolio, can find solace in DSP Blackrock Micro Cap Reg-G Fund.

The Micro Cap Fund is being managed by Vinit Sambre since June 2010. The fund manager adopts a bottom up approach in picking stocks. The fund looks for growth investing opportunities and chooses companies that have sustainable competitive advantages over their peers. The companies picked in the portfolio are also the leaders in their respective industries. Due to the leadership position of the stocks chosen there is a possibility that the stocks are trading with a premium to its peers.

Managing a fund that focuses on small and mid cap stocks can be tricky and the risks are magnified for such funds with 100 per cent allocation to small and mid cap stocks.

The fund has delivered excellent returns over a 5 year period with the annualised returns being 27.7 per cent. The returns delivered over a 3 year period stand at an impressive 53 per cent on an annualised basis. The returns from this fund that invests primarily in small and mid cap stocks clearly beats the category returns over long term with the category returns being 22.4 per cent over a 3 year period and 12.7 per cent over a 5 year period.