Bandhan Small Cap Direct Growth Plan review with returns, rolling returns, BOR, risk metrics, expense ratio, and portfolio analysis. Find out whether this small-cap mutual fund is suitable for long-term investors.
🚀 Introduction
The Bandhan Small Cap Direct Growth Plan has become one of the popular choices among investors looking for high-growth opportunities in the small-cap mutual fund category. Small-cap funds are known for their ability to generate substantial long-term returns, although they can experience higher volatility compared to large-cap funds.
This review analyzes the Bandhan Small Cap Direct Growth Plan using 14 important checkpoints including returns, rolling returns, benchmark outperformance ratio, risk metrics, drawdowns, portfolio quality, and fund management efficiency.
📌 Quick Snapshot
| Parameter | Value |
|---|---|
| Category | Small Cap Fund |
| Benchmark | NIFTY Smallcap 250 TRI |
| AUM | ₹27,219 Crore |
| Expense Ratio | 0.34% |
| Fund Manager Tenure | 3.5 Years |
| Risk Level | Very High |
| Investment Horizon | 7+ Years |
📈 Returns Comparison
| Period | Fund | Benchmark |
|---|---|---|
| 1 Year | 7.96% | -3.42% |
| 3 Years | 29.17% | 23.39% |
| 5 Years | 22.26% | 16.32% |
✅ Key Highlights
✔ Beat the benchmark across all periods.
✔ 5-Year CAGR above 22%.
✔ Strong wealth creation potential.
🔄 Rolling Returns
| Horizon | Fund | Benchmark |
|---|---|---|
| 1 Year | 35.14% | 32.67% |
| 3 Years | 31.51% | 27.36% |
| 5 Years | 31.22% | 26.98% |
| Horizon | Performance |
|---|---|
| 1 Year | 65%-70% Outperformance |
| 3 Years | 75%-80% Outperformance |
| 5 Years | Consistent Outperformance |
⭐ Rolling Return Score: 5/5
Why are Rolling Returns important?
Rolling returns measure performance across multiple periods instead of a single start and end date.
Analysis
The Bandhan Small Cap Fund Rolling Returns show consistent outperformance across various market periods.
The fund has demonstrated excellent consistency across multiple market cycles.
🏆 BOR Analysis
| Horizon | BOR |
|---|---|
| 3 Years | Above 75% – 80% |
| 5 Years | Above 100% |
| 10 Years | N.A. |
BOR Interpretation
🟢 Higher BOR indicates stronger consistency.
🟢 The fund beat the benchmark during most rolling periods.
🟢 Long-term investors benefit from this consistency.
⚡ Risk Metrics
| Metric | Fund | Benchmark |
|---|---|---|
| Alpha | 5.25 | 0.00 |
| Beta | 0.86 | 1.00 |
| Sharpe Ratio | 1.25 | 0.82 |
| Sortino Ratio | 2.45 | 1.34 |
| Standard Deviation | 18.24% | 20.90% |
Risk Score
✅ Alpha: Excellent
✅ Volatility: Lower
✅ Risk-Adjusted Return: Superior
📊 3-Year Risk Parameters
| Parameter | Fund | Category | Index |
|---|---|---|---|
| Alpha | 9.06 | -0.07 | -0.92 |
| Beta | 0.91 | 0.86 | 0.49 |
| R² | 95.22 | 92.22 | 17.40 |
| Sharpe Ratio | 1.08 | 0.63 | 0.51 |
| Standard Deviation | 20.89% | 19.86% | 15.49% |
Observation
✔ Highest Alpha.
✔ Better Sharpe Ratio.
✔ Strong benchmark correlation.
📉 5-Year Risk Parameters
| Parameter | Fund | Category | Index |
|---|---|---|---|
| Alpha | 6.00 | 2.23 | 3.27 |
| Beta | 0.90 | 0.83 | 0.39 |
| R² | 91.60 | 89.61 | 14.21 |
| Sharpe Ratio | 0.88 | 0.69 | 0.47 |
| Standard Deviation | 19.31% | 17.89% | 14.74% |
Observation
✔ Strong long-term consistency.
✔ Superior risk-adjusted returns.
🛡️ Upside & Downside Capture
| Metric | Fund | Benchmark |
|---|---|---|
| Upside Capture Ratio | 88% | 100% |
| Downside Capture Ratio | 68% | 100% |
| Maximum Drawdown | -24.3% | -31.8% |
Interpretation
✅ Lower downside risk.
✅ Better capital protection.
✅ Smaller drawdowns during market corrections.
👍 Pros & Cons
Pros
✔ Strong 3-Year and 5-Year returns.
✔ High BOR score.
✔ Positive Alpha generation.
✔ Better Sharpe Ratio.
✔ Low expense ratio.
✔ Lower drawdown.
✔ Strong SIP potential.
Cons
❌ Small-cap category remains volatile.
❌ No 10-year performance history.
❌ Requires a long investment horizon.
⭐ Final Verdict
| Category | Rating |
|---|---|
| Returns | ⭐⭐⭐⭐⭐ |
| Rolling Returns | ⭐⭐⭐⭐⭐ |
| BOR | ⭐⭐⭐⭐⭐ |
| Risk Management | ⭐⭐⭐⭐ |
| Downside Protection | ⭐⭐⭐⭐ |
| Expense Ratio | ⭐⭐⭐⭐⭐ |
| Overall | ⭐⭐⭐⭐⭐ |
Should You Invest?
The Bandhan Small Cap Fund Direct Growth Plan stands out because of its strong returns, high benchmark outperformance, and attractive risk-adjusted performance.
Investors with a 7–10 year investment horizon who can tolerate short-term volatility may consider this fund for long-term wealth creation.
Overall Rating: ⭐⭐⭐⭐⭐ (4.8/5)
💡 Best Suitable For:
- SIP Investors
- Long-Term Investors
- Aggressive Growth Investors
- Small-Cap Allocation Investors