Which midcap and small cap funds handle market stress better?

According to the latest AMFI data, midcap mutual fund schemes continue to maintain relatively comfortable liquidity positions despite rising assets under management (AUM).

The stress test estimates how many days a fund would take to liquidate part of its portfolio during stressed market conditions after excluding the least liquid holdings.

Among midcap funds, HDFC AMC’s HDFC Mid Cap Fund remained the largest scheme with assets worth Rs. 94,794 crore. The fund would require 45 days to liquidate 50% of its portfolio and 23 days for 25% liquidation, compared to 39 days and 20 days respectively in April 2025.

Kotak Midcap Fund would require 29 days for 50% liquidation and 15 days for 25% liquidation against 21 days and 11 days last year.

Nippon India Growth Mid Cap Fund maintained stable liquidity despite higher AUM, with its liquidation timeline unchanged at 10 days for 50% of the portfolio and 5 days for 25% liquidation.

Motilal Oswal Midcap Fund saw one of the sharpest increases in stress test timelines. The scheme would require 13 days for 50% liquidation and 7 days for 25% liquidation compared to 8 days and 4 days respectively a year ago.

Meanwhile, SBI Funds Management Limited’s SBI Midcap Fund showed improved liquidity, with its 50% liquidation period declining to 19 days from 24 days, while the 25% liquidation timeline improved to 10 days from 12 days.

DSP Midcap Fund also reported better liquidity, with its liquidation timeline improving to 9 days for 50% of the portfolio and 4 days for 25% liquidation.

Among the relatively more liquid midcap schemes, Edelweiss Mid Cap Fund and HSBC Midcap Fund would require only 4 days for 50% liquidation and 2 days for 25% liquidation.

Let’s look at the table for a better understanding:

In the small cap category, larger schemes continued to report significantly higher liquidation timelines due to their sizeable corpus and relatively lower market liquidity.

Nippon India Small Cap Fund with assets worth Rs. 72,664 crore required 29 days to liquidate 50% of its portfolio and 15 days for 25% liquidation, largely unchanged from last year.

SBI Funds Management Limited’s SBI Small Cap Fund reported the highest liquidation timeline among major small cap schemes. The fund would require 65 days to liquidate 50% of its portfolio and 33 days for 25% liquidation, up from 54 days and 27 days respectively in April 2025.

Meanwhile, quant Small Cap Fund also reported 65 days for 50% liquidation and 33 days for 25% liquidation, although its liquidity profile improved marginally compared to last year.

HDFC Asset Management Company’s HDFC Small Cap Fund would require 51 days for 50% liquidation and 25 days for 25% liquidation, while DSP Small Cap Fund reported 52 days and 26 days respectively.

Axis Small Cap Fund showed improved liquidity, with its 50% liquidation timeline declining to 23 days from 26 days last year, while the 25% liquidation period improved to 12 days from 13 days.

Among the relatively more liquid small cap schemes in the top 10 category, HSBC Small Cap Fund and Franklin India Small Cap Fund would require only 10–11 days for 50% liquidation and 5–6 days for 25% liquidation.

Let’s look at the table for a better understanding:

Cafemutual is set to host the Bangalore edition of its flagship passive investing event, the Cafemutual SIF Summit, on Thursday, June 24, 2026, at The Chancery Pavilion, Bangalore.

The summit will present a comprehensive view of SIFs, covering their structure, regulatory evolution, distribution frameworks, and long-term role in India’s financial landscape. It will bring together asset managers, distributors, wealth advisors, and regulators to discuss and shape the future of this new asset class.

Secure your seat today for the Cafemutual SIF Summit 2026, Bangalore, by clicking here: https://www.cafemutualevents.com/