All You Need to Know About the Bajaj Finserv Multi Cap Fund

Bajaj Finserv AMC has introduced a new equity product – the Bajaj Finserv Multi Cap Fund. The New Fund Offer (NFO) duration of this scheme is from Thursday, 06th February, 2025 to Thursday, 20th February, 2025. This fund offers a fresh approach to investing, focusing on discovering overlooked investment opportunities in the market. Rather than simply following popular trends, it aims to find value in stocks that are underappreciated or undervalued, waiting for the market to eventually realize their true potential.

The fund follows a contrarian investment strategy, meaning it goes against the crowd. Instead of jumping into the market when everyone is excited and prices are high, contrarian investors prefer to identify opportunities when others are feeling uncertain or when the market is down. By investing in undervalued stocks during tough times and holding onto them until the market rebounds, this strategy allows investors to profit from stocks that are trading below their real worth.

The goal of contrarian investing is to capitalize on the market’s tendency to overreact. For example, when the market faces a downturn or when negative news affects certain stocks, their prices can fall much lower than their actual value. Contrarian investors take advantage of these situations, purchasing undervalued stocks during a market correction, then selling them when the market realizes their true worth and prices rise.

By thinking differently and investing when others are too cautious, contrarian investors often find opportunities that other market participants miss. This approach requires patience and a long-term perspective, as it can take time for the market to recognize the true value of these investments.

How does the Bajaj Finserv Multi Cap Fund work?

TheBajaj Finserv Multi Cap Fund follows a contrarian investment approach, and here’s how it works:

Spot the trend: The first step is to understand market sentiments. Is the market too optimistic, or is there excessive fear? Recognizing these trends helps identify when it might be a good time to go against the grain.

Look for discrepancies: Contrarian investors actively search for situations where the market’s sentiment doesn’t align with the true value of a stock. This could happen when stocks are being sold off due to short-term fears or when a market trend overlooks the long-term potential of certain companies.

Find undervalued stocks: After spotting market trends and identifying discrepancies, investors look for companies whose stock prices are lower than their actual value. These undervalued stocks offer long term growth potential once the market adjusts its perception of them.

Invest: When others are unsure or fearful, contrarian investors take the opportunity to buy stocks at a lower price. They take a position in these undervalued stocks, with the belief that they will eventually recover and rise in value.

Sell or adjust: When the market sentiment changes, and prices rise to reflect the true value of the stocks, investors can either sell their shares or adjust their positions to lock in profits.

By following this contrarian approach, the Bajaj Finserv Multi Cap Fund aims to uncover opportunities that others might not see. This strategy of investing against the crowd often leads to identifying stocks that offer significant growth potential in the long term.

Why should you consider investing in the Bajaj Finserv Multi Cap Fund?

There are several reasons why the Bajaj Finserv Multi Cap Fund could be a suitable addition to your investment portfolio:

Invests in undervalued stocks: The fund focuses on identifying stocks that are priced below their true value, giving them the potential to grow as the market recognizes their real worth.

Capitalizes on market behaviour: The fund seeks to take advantage of market mispricing by identifying opportunities when others are being too cautious. In doing so, it can profit from behavioral biases in the market that create undervalued investment opportunities.

Diversification across companies of all sizes: By investing in large, mid, and small cap companies, the fund ensures that no growth opportunity is missed. This diversification helps reduce risk and increase potential returns in long term.

Long term growth strategy: The Bajaj Finserv Multi Cap Fund can be for investors with a long-term investment horizon. With a focus on undervalued stocks, it aims to provide significant growth as the market recognizes the true value of these companies over time.

A balanced investment approach: The fund provides investors with a balanced and disciplined investment strategy, ensuring exposure to various market segments while focusing on undervalued opportunities that have the potential for long-term growth.

Who should consider investing in the Bajaj Finserv Multi Cap Fund?

The Bajaj Finserv Multi Cap Fund is suitable for a wide range of investors, including:

Investors seeking undervalued stocks: If you are looking for stocks that have growth potential and are currently undervalued, this fund could be a good fit for you.

Long-term investors: If you have a 5+ year investment horizon and are looking for long-term growth, the Bajaj Finserv Multi Cap Fund can help you capitalize on the hidden potential of undervalued stocks.

Investors seeking diversification: The fund’s exposure to large, mid, and small cap stocks provides diversified investment opportunities across various market segments, reducing overall risk.

Investors looking for a contrarian strategy: If you believe in going against the crowd and looking for investment opportunities others might overlook, this fund’s contrarian approach can be helpful.

Conclusion

The Bajaj Finserv Multi Cap Fund provides a unique opportunity for investors who are looking to think differently and invest in undervalued stocks with long-term growth potential. By following a contrarian investment approach, this fund seeks to uncover hidden opportunities in the market that others may overlook. With its diversified strategy across large, mid, and small cap stocks, the fund offers a balanced way to capture growth in different market conditions. If you’re an investor with a long-term perspective and a focus on finding value in the market, starting an SIP or lumpsum investment the Bajaj Finserv Multi Cap Fund could be a suitable addition to your portfolio. You can make use of anSIP calculator online to get an estimate of your SIP investment amount.

Mutual Fund investments are subject to market risks, read all scheme related documents carefully.

Note to readers: This article is part of Mint’s paid consumer connect Initiative. Mint assumes no editorial involvement or responsibility for errors, omissions, or content accuracy.

Want to get your story featured as above? click here!