1. Focused funds are a type of
funds that invests in a limited number of stocks—not more than 30.
2. Not more than 10% of the portfolio is allocated to a single stock.
3. The investment universe can be any particular market capitalisation oriented like large or mid or small or market cap agnostic.
How mutual fund investments are taxed
4. The objective of such funds is to deliver high returns by investing in companies with growth potential.
5. With larger exposure to individual stocks, the volatility is higher making it riskier than a diversified equity fund.
(Content on this page is courtesy Centre for Investment Education and Learning (CIEL). Contributions by Girija Gadre, Arti Bhargava and Lab