Australian Small & Mid Cap Equity Funds are investment funds focused on stocks of smaller companies listed on the Australian Stock Exchange.
This segment of the equity market offers investors opportunities for capital growth, often with higher potential returns than larger cap stocks, while also coming with distinct risks.
Australian Small & Mid Cap Equity Funds primarily invest in companies with smaller market capitalizations—typically classified as those with a market capitalization under $3 billion (small cap) and between $3 billion and $10 billion (mid cap).
These funds aim to capture the upside potential of smaller companies that may not be as widely followed as large caps, often leading to opportunities for higher growth.
There are two main types of Australian Small & Mid Cap Equity Funds:
There are two main features of Australian Small & Mid Cap Equity Funds:
There are three main risks of investing in Australian Small & Mid Cap Equity Funds:
When comparing these funds, investors should consider the following factors:
Investors can gain exposure to Australian Small & Mid Cap Equity Funds through:
A small-cap stock typically has a market capitalisation of under $3 billion.
A mid-cap stock generally falls between $3 billion and $10 billion in market capitalisation.
Small & Mid Cap Equity Funds are generally better suited to risk-tolerant investors looking for higher growth asset classes.
Capital gains generation can lead to tax liabilities and income tax is payable on fund distributions, varying by individual circumstances.
Investors can generally redeem their units by following the fund's specific withdrawal process which can take time.
Yes, due to market volatility and fund performance risks.
It is advisable to assess your portfolio at least annually, or more frequently if market conditions change.
This varies by fund. Some funds may have minimum initial investments ranging from $1,000 to $5,000.
Australian Small & Mid Cap Equity Funds represent a distinctive investment opportunity with the potential for significant capital growth. This asset class presents both unique benefits and risks.
By understanding the types of Australian Small & Mid Cap Equity Funds available and how to evaluate them, investors can make informed decisions that align their portfolios with their risk tolerance and investment objectives.
The Fund provides an opportunity to access a highly experienced investment team with a proven track record of prudent, common sense investing.
The Fund combines the skills of highly experienced small company investors with a limited fund size and an objective of providing above market returns over the medium term.
The Merewether Capital Inception Fund invests in small and microcap companies listed on the ASX, with the ability to invest in pre-IPO opportunities. (For Wholesale Investors only)
The Fund objective is to outperform the S&P/ASX Small Ordinaries Accumulation Index over rolling 5-year periods. (For Wholesale Investors Only)
The Monash Investors Small Companies Fund offers investors an Australian equity fund with a long bias and an Absolute Return focus.
The Fund aims to provide long-term capital growth and income by investing in companies outside the S&P/ASX 50 Index. (For Wholesale Investors Only)
The ASF aims to provide Eligible Investors with access to a portfolio of ASX listed equity securities outside the S&P/ASX 100 Index. The portfolio may also have some exposure to ASX listed securities and global companies. (Wholesale Investors Only)
OC’s Premium Small Companies portfolio is designed to deliver strong long-term returns by investing in quality small to mid-cap Australian listed companies with sustainable business models, quality management and attractive investment fundamentals.
The Fund seeks to achieve superior total returns by providing medium to long term capital growth investing in smaller capitalisation companies.
Through Invesco’s proprietary investment model, the Fund seeks to unlock persistent long-term excess returns by investing in smaller companies listed on the Australian share market, predominantly outside the S&P/ASX 100 Index.
The Fund is a long only, small cap Australian equities fund that typically invests in 20 – 40 companies. The objective of the Fund is to provide strong absolute returns, while also outperforming its S&P/ASX Small Ordinaries Accumulation Index.
The Portfolio comprises between 20 and 40 securities and aims to outperform the S&P/ASX 300 index excluding the 20 largest companies.
The Fund invests in a portfolio of primarily ASX-listed Securities outside (but not exclusively outside) the S&P/ASX 100 (For Wholesale Investors Only)
The Fund aims to deliver long-term growth by investing in 30 to 50 high-quality, small, emerging and developing Australian and NZ companies with strong and enduring growth potential.
The Fund’s objective is to outperform the Small Ordinaries Accumulation Index by focusing on listed shares of smaller companies in Australia and New Zealand.
