Best Small Cap Funds to Invest in November 2026
Foliyo’s research compared 33 small cap funds on returns, consistency, risk and cost. These 10 rank highest; 5 are Leaders.
- Small Cap funds reviewed
- 33
- Median 3-year return a year
- 12.8%
- Median expense ratio
- 0.90%
- Data as of
- 23 October 2026
Best 3 in November 2026
- 1
Invesco India Small Cap Fund Leader19.5% 3Y a year - 2
Bandhan Small Cap Fund Leader22.1% 3Y a year - 3TrustMF Small Cap Fund Emerging— 3Y a year
Category median 12.8% a year over 3 years
The leaders are well ahead of the 12.8% peer median over 3 years (Invesco India 19.5%, Bandhan 22.1%) and fell less than the benchmark in bad months (downside capture 70 and 75). The laggards ICICI Prudential (9.2%) and Kotak (10.2%) trail the median over 3 and 5 years. The 1-year peer median is only 2.1%, so 1-year gaps are small, and the funds ranked high on short records (TrustMF, Motilal Oswal, Bajaj) have under 3 years of data and are not proven.
Best small cap funds in November 2026: the ranking of 10
Ranked by Foliyo’s research among 33 small cap funds with at least ₹500 Cr. Returns are for the Direct Growth plan to 23 October 2026 (3 and 5-year returns a year; the bar shows the 3-year return); fund size as of 30 September 2026.
| # | Fund (Direct Growth) and Foliyo label | 1Y return | 3Y return | 5Y return | Expense ratio | Fund size |
|---|---|---|---|---|---|---|
| 1 | Invesco India Small Cap Fund Leader | 2.9% | 19.5% | 17.4% | 0.63% | ₹16,131 Cr |
| 2 | Bandhan Small Cap Fund Leader | 2.3% | 22.1% | 18.0% | 0.61% | ₹35,856 Cr |
| 3 | TrustMF Small Cap Fund Emerging | 16.4% | — | — | 1.54% | ₹3,877 Cr |
| 4 | ITI Small Cap Fund Leader | 7.5% | 20.6% | 15.9% | 0.86% | ₹3,666 Cr |
| 5 |  Bank of India Small Cap Fund Leader | 16.7% | 18.8% | 17.9% | 0.73% | ₹3,671 Cr |
| 6 | Quant Small Cap Fund Leader | 3.8% | 16.4% | 16.5% | 0.93% | ₹35,572 Cr |
| 7 |  Motilal Oswal Small Cap Fund Emerging | 9.6% | — | — | 0.85% | ₹8,298 Cr |
| 8 |  Mahindra Manulife Small Cap Fund Strong | 4.7% | 17.4% | — | 0.96% | ₹5,373 Cr |
| 9 |  Edelweiss Small Cap Fund Strong | −1.4% | 12.8% | 14.5% | 0.65% | ₹6,928 Cr |
| 10 |  DSP Small Cap Fund Strong | 9.9% | 15.4% | 15.6% | 0.81% | ₹21,467 Cr |
Category median: 12.8% a year over 3 years, 2.1% over 1 year, expense ratio 0.90%. # is the fund’s rank among all 33 in the review; funds too young or with too little data to rank are left out. A “—” means the fund is too young for that period.
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The 10 funds, one by one
Invesco India Small Cap Fund Direct Growth
Rank 1 of 33, managed by Taher Badshah (lead since Oct 2018), Very High risk
Leader Top rated: over 3 years it returned 19.5% a year against 12.8% for similar funds, at a lower yearly fee of 0.63% against 0.9%.
Over 3 years the fund returned 19.5% a year, against 12.8% for similar funds, and over 5 years 17.4% a year, against 14.0%. Its yearly fee is 0.63%, against 0.9% for similar funds. It has stayed ahead of similar funds in nearly all 3-year stretches, fell less when markets dropped, and the same lead manager has run it since October 2018. Keep in mind that its recent edge is thin: 1-year return is 2.9% against 2.1%, and it lost 5.0% over the last 3 months. It is a small-cap fund, so sharp falls and rises are normal, and its holdings are priced fairly high.
Pros
- The 3-year return is 19.5% against a peer median of 12.8%, and the 5-year return is 17.4% against 14.0%.
- It was ahead of the peer median in 98.4% of rolling 3-year periods and was in the top half of its category in 4 of 5 calendar years.
- Downside capture is 70 with upside capture of 104, and the 3-year Sharpe ratio is 0.8 against a peer median of 0.53.
Cons
- The recent edge is thin: the 1-year return is 2.9% against a median of 2.1%, and the 3-month return is -5.0%.
- It is still a small-cap fund: the 3-year maximum drawdown is -20.6% and the portfolio P/E is 32.1.
- 1-year return
- 2.9% +0.8 pts median 2.1%
- 3-year return (a year)
- 19.5% +6.6 pts median 12.8%
- 5-year return (a year)
- 17.4% +3.4 pts median 14.0%
- Sharpe ratio (3Y)
- 0.80 +0.27 median 0.53
- Volatility (3Y)
- 19.8% level median 19.9%
- Worst fall (3Y)
- −20.6% +1.9 pts median −22.5%
- Downside capture (3Y)
- 70 −9 median 79
- Expense ratio
- 0.63% −0.27 pts median 0.90%
- Cash
- 1.1% median 4.5%
- Fund size
- ₹16,131 Cr median ₹6,120 Cr
Bandhan Small Cap Fund Direct Growth
Rank 2 of 33, managed by Manish Gunwani (lead since Jan 2023), Very High risk
Leader Top rated: over 3 years it returned 22.1% a year against 12.8% for similar funds, at a lower yearly fee, though the last year was only slightly ahead.
Over 3 years the fund returned 22.1% a year, against 12.8% for similar funds, and over 5 years 18.0% a year, against 14.0%. Its yearly fee is 0.61%, against 0.9% for similar funds. It fell less than similar funds when markets dropped, and it was ahead of them in most 3-year stretches. Keep in mind that the last year was only 2.3%, against 2.1% for similar funds, and it was in the better half of its category in 3 of the last 5 calendar years. It holds 13.0% in cash, unusual for a small-cap fund, and the lead manager has been in place only since January 2023.
Pros
- The 3-year return is 22.1% against a peer median of 12.8%, and the 5-year return is 18.0% against 14.0%.
- It was ahead of the peer median in 91.1% of rolling 3-year periods, but in the top half of its category in only 3 of 5 calendar years.
- Downside capture is 75 and upside capture is 112, and the 3-year Sharpe ratio is 0.84.
Cons
- It holds 13.0% in cash (net equity 87.0%), an unusual call for a small-cap fund. The 1-year return is only 2.3% against a median of 2.1%.
- 3-year volatility is 20.5% against a peer median of 19.9%, and the lead manager (Manish Gunwani) has run it only since Jan 2023, so the 5-year record includes an earlier period.
- 1-year return
- 2.3% +0.2 pts median 2.1%
- 3-year return (a year)
- 22.1% +9.3 pts median 12.8%
- 5-year return (a year)
- 18.0% +4.0 pts median 14.0%
- Sharpe ratio (3Y)
- 0.84 +0.31 median 0.53
- Volatility (3Y)
- 20.5% +0.6 pts median 19.9%
- Worst fall (3Y)
- −21.3% +1.3 pts median −22.5%
- Downside capture (3Y)
- 75 −4 median 79
- Expense ratio
- 0.61% −0.29 pts median 0.90%
- Cash
- 13.0% median 4.5%
- Fund size
- ₹35,856 Cr median ₹6,120 Cr
TrustMF Small Cap Fund Direct Growth
Rank 3 of 33, managed by Mihir Vora (lead since Nov 2024), Very High risk
Emerging Promising but too early: 1-year return of 16.4% against a 2.1% median, offset by a 1.54% expense ratio.
Pros
- The 1-year return is 16.4% against a peer median of 2.1%, and the fund was ahead of the median in 100.0% of rolling 1-year periods.
- 1-year downside capture is 69, the 1-year maximum drawdown is -10.8% and the 1-year Sharpe ratio is 1.12.
- It is 2.0 years old, so it has no 3-year record and has only been through one stretch of the market.
Cons
- The expense ratio is 1.54% against a peer median of 0.90%, a permanent handicap.
- The portfolio P/E is 40.3 and 1-year volatility is 22.6%; the data does not show whether the lead is skill or one favourable run.
- 1-year return
- 16.4% +14.3 pts median 2.1%
- Expense ratio
- 1.54% +0.64 pts median 0.90%
- Cash
- 5.8% median 4.5%
- Fund size
- ₹3,877 Cr median ₹6,120 Cr
ITI Small Cap Fund Direct Growth
Rank 4 of 33, managed by Dhimant Shah (lead since Aug 2022), Very High risk
Leader A category leader: ranks 4 of 33 in Small-Cap.
Pros
- 3-year return (a year) 20.6% vs peer median 12.8%
- 5-year return (a year) 15.9% vs peer median 14.0%
- Ahead of the peer median in 98.4% of rolling 1-year periods (weekly, last 3 years)
Cons
No red flags this month.
- 1-year return
- 7.5% +5.4 pts median 2.1%
- 3-year return (a year)
- 20.6% +7.7 pts median 12.8%
- 5-year return (a year)
- 15.9% +1.9 pts median 14.0%
- Sharpe ratio (3Y)
- 0.86 +0.33 median 0.53
- Volatility (3Y)
- 20.1% +0.2 pts median 19.9%
- Worst fall (3Y)
- −20.9% +1.6 pts median −22.5%
- Downside capture (3Y)
- 65 −13 median 79
- Expense ratio
- 0.86% −0.04 pts median 0.90%
- Cash
- 3.1% median 4.5%
- Fund size
- ₹3,666 Cr median ₹6,120 Cr
Bank of India Small Cap Fund Direct Growth
Rank 5 of 33, managed by Alok Singh (lead since Oct 2024), Very High risk
Leader A category leader: ranks 5 of 33 in Small-Cap.
Pros
- 3-year return (a year) 18.8% vs peer median 12.8%
- Ahead of the peer median in 95.9% of rolling 3-year periods (weekly, last 3 years)
- 5-year return (a year) 17.9% vs peer median 14.0%
Cons
- Lead manager has run it for 2.1 years
- Worst fall (3Y) -24.5% vs peer median -22.5%
- Holds 13.1% in cash (net equity 85.7%)
- 1-year return
- 16.7% +14.6 pts median 2.1%
- 3-year return (a year)
- 18.8% +5.9 pts median 12.8%
- 5-year return (a year)
- 17.9% +3.9 pts median 14.0%
- Sharpe ratio (3Y)
- 0.73 +0.20 median 0.53
- Volatility (3Y)
- 21.9% +2.0 pts median 19.9%
- Worst fall (3Y)
- −24.5% −2.0 pts median −22.5%
- Downside capture (3Y)
- 78 −1 median 79
- Expense ratio
- 0.73% −0.17 pts median 0.90%
- Cash
- 13.1% median 4.5%
- Fund size
- ₹3,671 Cr median ₹6,120 Cr
Quant Small Cap Fund Direct Growth
Rank 6 of 33, managed by Sanjeev Sharma (lead since Feb 2017), Very High risk
Leader A category leader: ranks 6 of 33 in Small-Cap.
Pros
- 3-year return (a year) 16.4% vs peer median 12.8%
- Ahead of the peer median in 99.7% of rolling 3-year periods (weekly, last 3 years)
- 5-year return (a year) 16.5% vs peer median 14.0%
Cons
- Volatility (3Y) 20.2% vs peer median 19.9%
- Holds 12.4% in cash (net equity 87.6%)
- 1-year return
- 3.8% +1.8 pts median 2.1%
- 3-year return (a year)
- 16.4% +3.6 pts median 12.8%
- 5-year return (a year)
- 16.5% +2.5 pts median 14.0%
- Sharpe ratio (3Y)
- 0.58 +0.05 median 0.53
- Volatility (3Y)
- 20.2% +0.4 pts median 19.9%
- Worst fall (3Y)
- −23.6% −1.1 pts median −22.5%
- Downside capture (3Y)
- 80 +1 median 79
- Expense ratio
- 0.93% +0.03 pts median 0.90%
- Cash
- 12.4% median 4.5%
- Fund size
- ₹35,572 Cr median ₹6,120 Cr
Motilal Oswal Small Cap Fund Direct Growth
Rank 7 of 33, managed by Ajay Khandelwal (lead since Dec 2023), Very High risk
Emerging Promising at 2.8 years old: well ahead of peers over 1 year at a median-level cost, but it fell almost as much as the benchmark in bad months.
Pros
- The 1-year return is 9.6% against a peer median of 2.1%, and the fund was ahead of the median in 86.5% of rolling 1-year periods.
- The expense ratio is 0.85% against a peer median of 0.90%.
- The 1-year Sharpe ratio is 0.75 and the 1-year maximum drawdown is -15.2%.
Cons
- 1-year downside capture is 92 and 1-year volatility is 24.2%, so the lead came with close to full participation in falls.
- It holds 8.1% in cash and has no 3-year record yet, with the lead manager (Ajay Khandelwal) in place since Dec 2023.
- 1-year return
- 9.6% +7.5 pts median 2.1%
- Expense ratio
- 0.85% −0.05 pts median 0.90%
- Cash
- 8.1% median 4.5%
- Fund size
- ₹8,298 Cr median ₹6,120 Cr
Mahindra Manulife Small Cap Fund Direct Growth
Rank 8 of 33, managed by Krishna Sanghavi (lead since Oct 2024), Very High risk
Strong A strong fund: ranks 8 of 33 in Small-Cap.
Pros
- 3-year return (a year) 17.4% vs peer median 12.8%
- Ahead of the peer median in 100.0% of rolling 3-year periods (weekly, last 3 years)
Cons
- Lead manager has run it for 2.0 years
- Worst fall (3Y) -25.8% vs peer median -22.5%
- 1-year return
- 4.7% +2.7 pts median 2.1%
- 3-year return (a year)
- 17.4% +4.5 pts median 12.8%
- Sharpe ratio (3Y)
- 0.70 +0.17 median 0.53
- Volatility (3Y)
- 19.9% level median 19.9%
- Worst fall (3Y)
- −25.8% −3.3 pts median −22.5%
- Expense ratio
- 0.96% +0.06 pts median 0.90%
- Cash
- 0.8% median 4.5%
- Fund size
- ₹5,373 Cr median ₹6,120 Cr
Edelweiss Small Cap Fund Direct Growth
Rank 9 of 33, managed by Trideep Bhattacharya (lead since Dec 2021), Very High risk
Strong A strong fund: ranks 9 of 33 in Small-Cap.
Pros
- Ahead of the peer median in 92.0% of rolling 3-year periods (weekly, last 3 years)
- Expense ratio 0.65% vs peer median 0.90%
Cons
No red flags this month.
- 1-year return
- −1.4% −3.5 pts median 2.1%
- 3-year return (a year)
- 12.8% −0.1 pts median 12.8%
- 5-year return (a year)
- 14.5% +0.5 pts median 14.0%
- Sharpe ratio (3Y)
- 0.51 −0.03 median 0.53
- Volatility (3Y)
- 18.5% −1.4 pts median 19.9%
- Worst fall (3Y)
- −20.9% +1.6 pts median −22.5%
- Downside capture (3Y)
- 77 −1 median 79
- Expense ratio
- 0.65% −0.25 pts median 0.90%
- Cash
- 1.9% median 4.5%
- Fund size
- ₹6,928 Cr median ₹6,120 Cr
DSP Small Cap Fund Direct Growth
Rank 10 of 33, managed by Vinit Sambre (lead since Jun 2010), Very High risk
Strong A strong fund: ranks 10 of 33 in Small-Cap.
Pros
- 1-year return 9.9% vs peer median 2.1%
Cons
- Downside capture (3Y) 81 vs peer median 79
- Volatility (3Y) 21.3% vs peer median 19.9%
- Holds 11.4% in cash (net equity 88.6%)
- 1-year return
- 9.9% +7.8 pts median 2.1%
- 3-year return (a year)
- 15.4% +2.6 pts median 12.8%
- 5-year return (a year)
- 15.6% +1.6 pts median 14.0%
- Sharpe ratio (3Y)
- 0.58 +0.05 median 0.53
- Volatility (3Y)
- 21.3% +1.5 pts median 19.9%
- Worst fall (3Y)
- −21.6% +0.9 pts median −22.5%
- Downside capture (3Y)
- 81 +3 median 79
- Expense ratio
- 0.81% −0.09 pts median 0.90%
- Cash
- 11.4% median 4.5%
- Fund size
- ₹21,467 Cr median ₹6,120 Cr
Emerging small cap funds to watch
Younger than 3 years, so not judged on a full record yet, but with one of the strongest first years against every peer’s last year:
- Bajaj Small Cap Fund: Too early to judge at 1.3 years: a 1-year lead over the median, but a short record and a cost slightly above median.
Compare the largest small cap funds
What is a small cap fund?
A small cap fund keeps at least 65% of its money in companies ranked 251st and below by market value. Returns can be the highest over long periods, and falls of 40% or more have happened, so it needs a horizon of 7 years or more.
Read more: How much to put in large, mid and small cap funds.
How Foliyo’s research ranks funds
Every month Foliyo’s Research Desk reviews each Indian mutual fund with at least ₹500 Cr under management (1,035 funds in the review of 23 October 2026), through its Direct Growth plan, and ranks it against the other funds in its category. No fund house pays us, and we earn no commission, so the ranking has no reason to favour anyone. For equity funds the ranking weighs:
- Performance (35%): 3, 5 and 1-year returns, and where the fund stands among all funds in its category over 3 and 5 years.
- Consistency (25%): how often the fund was ahead of its peers over rolling 1 and 3-year periods, and in how many calendar years it finished in the top half.
- Risk (25%): return per unit of risk (Sharpe and Sortino ratios), how much of the market’s falls it took (downside capture), its worst fall and its volatility.
- Cost (10%) and stability (5%): the expense ratio, and how long the lead manager has run the fund.
Where a fund stands sets its label: Leader (the strongest in the category), Strong, Steady and Laggard (behind most of its peers). A fund under 3 years old is never judged on a full record: its first year is compared with every peer’s last year (1-year return 25%, steadiness against peers 15%, Sharpe ratio 15%, worst fall 10%, downside capture 10%, cost 15%), and it is labelled Emerging when that start is among the strongest, or Too early otherwise. Red flags are set by rule, never by opinion: a new lead manager, a portfolio that strays from the category’s mandate, high cash, high cost or a concentrated portfolio.
Frequently asked questions
Which are the best small cap funds to invest in November 2026?
On Foliyo’s research (data to 23 October 2026), the five highest-ranked small cap funds are Invesco India Small Cap Fund (Leader), Bandhan Small Cap Fund (Leader), TrustMF Small Cap Fund (Emerging), ITI Small Cap Fund (Leader), Bank of India Small Cap Fund (Leader). The full list of 10, with each fund’s pros and cons, is on this page. Which one suits you depends on your goals and the funds you already own.
What is a small cap fund?
A small cap fund keeps at least 65% of its money in companies ranked 251st and below by market value. Returns can be the highest over long periods, and falls of 40% or more have happened, so it needs a horizon of 7 years or more.
How does Foliyo rank small cap funds?
Each small cap fund with at least ₹500 Cr is compared with the others on performance (3, 5 and 1-year returns), consistency (rolling returns and calendar years), risk (Sharpe and Sortino ratios, downside capture, worst fall, volatility), cost (expense ratio) and the lead manager’s tenure. The strongest are Leaders, then Strong, Steady and Laggard; funds under 3 years old are Emerging (a strong first year) or Too early.
What return have small cap funds given?
The median small cap fund in our review returned 12.8% a year over 3 years and 14.0% a year over 5 years, and 2.1% over the last year, to 23 October 2026 (Direct plans). The top-ranked fund, Invesco India Small Cap Fund, returned 19.5% a year over 3 years.
What is the expense ratio of small cap funds?
The median Direct plan in the category charges 0.90% a year. Regular plans cost more, often 0.6 to 1.2 points a year more, because the fee includes the distributor’s commission. See what that gap costs over time.
Is the top-ranked small cap fund the best one for me?
Not necessarily. The ranking says how funds have done against each other, not how they will do, and the right fund depends on your goals, horizon and the funds you already hold. A fee-only adviser can check your whole portfolio: talk to a Foliyo adviser.
Why hire a Foliyo Advisor?
- Unbiased
- No commissions, ever
- SEBI-registered RIA
- Best-in-class research