Bengaluru, Aug. 15 -- Small-cap equity Mutual Funds invest in stocks belonging to the small-cap segment, which includes all companies except the largest 250 listed companies ranked by market capitalisation. They are best suited for investors who are willing to invest for a minimum of 3-4 years and are seeking the potential for very high returns. However, such investors must also be prepared for the possibility of experiencing higher levels of losses in their investments.

Following are the top five best-performing small-cap equity mutual funds based on their 3-year annualised returns: HDFC Small Cap Fund With assets under management (AUM) of Rs. 36,353 crores, the HDFC Small Cap Fund - Direct Plan - Growth has delivered 3-year annualised ...