Home > Money > Question
Need Expert Advice?Our Gurus Can Help

Confused About SIP in Quant Small & Midcap: Should I Continue or Stop?

Ramalingam

Ramalingam Kalirajan  |9456 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jan 14, 2025

Ramalingam Kalirajan has over 23 years of experience in mutual funds and financial planning.
He has an MBA in finance from the University of Madras and is a certified financial planner.
He is the director and chief financial planner at Holistic Investment, a Chennai-based firm that offers financial planning and wealth management advice.... more
P Question by P on Jan 13, 2025Hindi
Listen
Money

I am doing SIP in QUANT SMALL CAP & MIDCAP since last 2 years. Recently they are involved in front running case and SEBI investigation is going on. My doubt is shall i continue SIP or stop the investment ? I am already having another 5 SIPS in small cap , midcap & flexi cap since last 5 years which are having CAGR of above 15%. If you advice me to stop SIP in QUANT, i will divert this amount in above 5 sips.

Ans: The ongoing SEBI investigation and other highlighted concerns about Quant Mutual Fund raise significant questions. Here is a comprehensive evaluation of whether to continue your SIPs or stop them.

1. Understanding the Current Situation with Quant Mutual Fund
SEBI conducted a search-and-seizure operation, not a routine enquiry.

Quant Mutual Fund clarified that the operation was part of a court-approved investigation.

Changes in leadership, such as the CFO's resignation, have added to investor concerns.

Despite these challenges, the fund house continues to assure full cooperation with SEBI.

2. Performance and Reputation of Quant Mutual Fund
Quant Mutual Fund has shown exceptional growth, with AUMs rising from Rs 233 crore to Rs 94,000 crore in four years.

The fund's small-cap schemes have delivered outstanding performance, often topping the charts.

Critics highlight red flags, including over-reliance on one individual and potential SEBI rule violations.

Momentum-based strategies and concentrated stock holdings raise questions about risk and sustainability.

3. Risks Associated with One-Man Show Management
Investment decisions reportedly rely heavily on Sandeep Tandon, the key figure at Quant.

Lack of a robust team structure and research capacity may pose systemic risks.

A one-person-driven strategy can lead to inconsistent performance in volatile markets.

Inadequate team size and resources could hinder the fund’s ability to address SEBI’s queries effectively.

4. Evaluating Diversification in Your Portfolio
You already have five SIPs in small-cap, mid-cap, and flexi-cap funds performing well with over 15% CAGR.

Diversifying across multiple fund houses reduces exposure to single-entity risks.

Overlapping strategies within the same fund categories may lead to over-concentration.

Reassess your portfolio’s allocation to ensure alignment with your financial goals.

5. Tax Implications of Stopping SIP and Redeeming Investments
If you decide to stop SIPs and redeem investments, consider the tax impact.

LTCG above Rs 1.25 lakh is taxed at 12.5%, while STCG is taxed at 20%.

Plan redemptions to minimise tax liability and reinvest strategically.

Use a Certified Financial Planner for tax-efficient portfolio adjustments.

6. Alternatives to Quant Funds for SIP Diversion
If you stop SIPs in Quant funds, divert the amount to your existing well-performing funds.

Actively managed funds with strong teams and transparent processes are ideal alternatives.

Ensure new investments align with your risk appetite and financial objectives.

Balance between equity and debt funds for portfolio stability and growth.

7. Impact of SEBI Investigation on Investor Confidence
SEBI’s findings may impact Quant Mutual Fund’s reputation and future performance.

Regulatory actions could introduce stricter compliance measures across the mutual fund industry.

Monitor updates on the investigation and assess its implications for the fund house.

Maintain vigilance about regulatory developments affecting the fund.

8. Importance of Fund House Credibility
A fund house's governance and transparency are critical for investor trust.

Reevaluate investments in funds with potential governance issues.

Choose funds with a strong track record of compliance and ethical practices.

Avoid funds overly dependent on individuals rather than institutional processes.

9. Making a Decision on Quant SIP Continuation
Reasons to Consider Stopping SIPs in Quant Funds:

Regulatory risks due to SEBI investigation.
Over-reliance on a one-man strategy.
Lack of institutional structure and research team.
Reasons to Consider Continuing SIPs in Quant Funds:

Exceptional past performance.
Potential for future returns if the fund overcomes current challenges.
10. Final Insights
The SEBI investigation and governance concerns warrant a cautious approach. If you are uncomfortable with the risks, stopping SIPs and diverting funds to your other well-performing SIPs is prudent. Maintain a diversified and balanced portfolio to safeguard your financial goals. Stay updated on SEBI developments and periodically review your investments with a Certified Financial Planner.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in
https://www.youtube.com/@HolisticInvestment
DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Users are advised to pursue the information provided by the rediffGURU only as a source of information to be as a point of reference and to rely on their own judgement when making a decision.
Money

You may like to see similar questions and answers below

Ramalingam

Ramalingam Kalirajan  |9456 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jun 25, 2024

Money
Sir, I have started two new SIPs ( @4K each) through MF just in last month, namely Quant Mid cap and Quant Large & Mid cap. Including these two presently I am continuing 60K of SIPs in different MFs for last 1 yr. Also had a plan to start a new SIP of 6K through Quant ELSS fund. But, after todays news of SEBI on Quant MF, I am confused. Should I stop the said one month old two funds and not to start ELSS or what? I have partially decided to continue with existing two funds and carefully watch on the situation for one/two year and not to start new MF with Quant. What should I do? Pls suggest.
Ans: First of all, commendations on your dedication to investing and planning for your financial future. Your efforts in consistently investing through SIPs are commendable. I understand your concern regarding the recent SEBI news about Quant Mutual Funds. Let’s address your queries and develop a comprehensive approach to your investment strategy.

Current SIP Investments
Your commitment to Rs 60,000 in SIPs over the last year is a strong start. SIPs offer the advantage of rupee cost averaging and can help in building a substantial corpus over time.

Evaluating Recent Investments
Given your recent start with Quant Mid Cap and Quant Large & Mid Cap funds, and the news about SEBI’s stance on Quant MF, your concerns are valid. Here’s a detailed analysis:

Market and Regulatory Sentiments: Regulatory actions can sometimes create uncertainty. However, it’s important to understand the specifics of SEBI's concerns and how they might impact the fund's performance and management.

Fund Performance: Before making any decisions, evaluate the historical performance of these funds. Look at their consistency, returns, and how they have managed risks.

Fund Management: Assess the expertise and track record of the fund managers. Effective management can often navigate through regulatory and market challenges.

Deciding on Continuation or Stopping SIPs
Continue Monitoring
Your decision to continue with the two existing funds while monitoring the situation is prudent. Here’s why:

Long-Term Perspective: Equity investments, especially in mutual funds, are meant for the long term. Short-term fluctuations or news should not drastically impact long-term strategies.

Performance Review: Regularly review the performance of these funds over the next 6-12 months. Evaluate them against their benchmarks and peer funds.

Adjust if Needed: If you notice consistent underperformance or if regulatory issues significantly impact the fund, consider reallocating to more stable funds.

New SIP in Quant ELSS
Considering the SEBI news, it’s understandable to be cautious about starting a new SIP in Quant ELSS. Here’s an alternative approach:

Diversification: Instead of putting all your SIPs in Quant funds, consider diversifying across different fund houses. This spreads your risk and can provide stability.

Evaluate Other ELSS Funds: Look for other ELSS funds with strong track records, good management, and consistent performance. ELSS not only offers tax benefits but also has the potential for good long-term returns.

Advantages of Actively Managed Funds
Actively managed funds are beneficial for several reasons:

Expertise: Fund managers actively make decisions to maximize returns and minimize risks.

Flexibility: These funds can adapt to changing market conditions, unlike index funds which replicate market performance.

Disadvantages of Direct Funds
While direct funds have lower expense ratios, there are notable disadvantages:

Lack of Professional Guidance: Without a Certified Financial Planner, managing direct funds can be challenging.

Time-Consuming: Monitoring and adjusting investments require significant time and expertise.

Recommended Strategy for Your SIPs
Diversified Portfolio
A well-diversified portfolio across different fund categories can enhance returns and reduce risks. Consider these steps:

Large Cap Funds: These funds invest in well-established companies with a stable growth trajectory.

Mid Cap Funds: They invest in medium-sized companies with potential for high growth.

Small Cap Funds: Suitable for aggressive investors, these funds can offer high returns but come with higher risks.

Balanced or Hybrid Funds: These funds offer a mix of equity and debt, providing stability and growth.

Regular Reviews
Schedule regular reviews with your Certified Financial Planner to ensure your portfolio remains aligned with your financial goals and market conditions. Adjustments may be necessary based on performance and market changes.

Building a Robust Investment Plan
Your goal should be to build a robust investment plan that can withstand market fluctuations and regulatory changes. Here’s how:

Emergency Fund
Maintain your emergency fund of Rs 15 lakhs. This provides a safety net for unexpected expenses and ensures you don’t have to dip into your investments prematurely.

Goal-Based Investments
Children’s Education: Continue investing through SIPs in diversified equity funds for long-term growth. This will help accumulate the required corpus for their education.

Retirement Planning: Invest in aggressive growth funds for your retirement goal. Starting early and maintaining consistency will leverage the power of compounding.

Importance of Staying Informed
Stay informed about market trends and regulatory changes. Knowledge empowers you to make informed decisions and adapt to changes effectively.

Role of a Certified Financial Planner
A Certified Financial Planner can provide invaluable guidance. They can:

Customise Portfolio: Tailor your investments based on your financial goals, risk tolerance, and market conditions.

Regular Monitoring: Continuously monitor your portfolio and make necessary adjustments.

Risk Management: Help you navigate market and regulatory risks effectively.

Final Insights
Your proactive approach to investing is commendable. Continuously monitoring and reviewing your investments is crucial. While the SEBI news about Quant MF is concerning, maintaining a long-term perspective is important. Diversify your portfolio to mitigate risks and ensure you are investing in well-managed funds.

Stay informed, regularly review your portfolio, and seek guidance from a Certified Financial Planner. This comprehensive approach will help you achieve your financial goals and secure your future.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

..Read more

Latest Questions
Nayagam P

Nayagam P P  |8244 Answers  |Ask -

Career Counsellor - Answered on Jul 08, 2025

Career
Hello sir, I have chances in the following nits :- 1. Manipur - electrical 2. Raipur- metallurgy, bio medical, bio tech, mining 3. IEST Shibpur - mining, metallurgy 4.Srinagar - mining, chemical,civil, metallurgy 5.Agartala bio tech, production engineer , chemical, civil 6. Rourkela - Life science Which college and braches should I have to choose so that when I graduate from these colleges I have no regrets along with future scope.
Ans: Jayanandan, Each institute combines strong accreditation, experienced faculty, updated laboratories, industry-linked internships and dedicated placement cells. NIT Manipur’s Electrical Engineering recorded a 90% placement rate in 2023 with high IT-sector recruiter engagement despite fewer core roles and offers broad power-electronics and renewable-systems exposure. NIT Raipur’s Metallurgical Engineering saw an 80.39% placement rate in 2024, with average packages of ?13.75 LPA, while Biomedical Engineering lagged at ~30–40% but offers collaboration with AIIMS for healthcare R&D. IIEST Shibpur’s Mining and Metallurgy programs achieved near-100% placements over four years, average packages of ?7–12 LPA, and recruit from leading public and private mining firms through legacy ties. NIT Srinagar’s Chemical Engineering led with a 104.29% placement rate, average package ?10.48 LPA, and 100% Metallurgy placements under a stable curriculum and strong PSU recruiter network. NIT Agartala’s Biotechnology & Biochemical Engineering achieved ~81% placement consistency and ?7 LPA median package, supported by biotechnology research labs and growing MoUs, while Chemical Engineering posted ~78% placements with ?8.52 LPA average. NIT Rourkela’s Life Sciences branch placed ~90% of its M.Sc. cohort at an average ?6.10 LPA, benefiting from DBT-sponsored projects and strong research orientation.

For the best blend of placement reliability, core-sector pedigree, and future scope, the recommendation is IIEST Shibpur Mining Engineering (if your health permits). Next in preference is NIT Srinagar Chemical Engineering, followed by NIT Manipur Electrical Engineering. Subsequent options are NIT Rourkela Life Sciences, NIT Raipur Metallurgical Engineering, and NIT Agartala Biotechnology & Biochemical Engineering to align with research and industry priorities. All the BEST for Admission & a Prosperous Future!

Follow RediffGURUS to Know More on 'Careers | Money | Health | Relationships'.

...Read more

Nayagam P

Nayagam P P  |8244 Answers  |Ask -

Career Counsellor - Answered on Jul 08, 2025

Career
Cse jp noida or cse iet lucknow
Ans: Amit, Jaypee Institute of Information Technology Noida’s B.Tech in Computer Science & Engineering is a NAAC A++- and NBA-accredited deemed-to-be university under UGC, with over 250 PhD-qualified faculty delivering a cutting-edge curriculum. Its department maintains 47 specialised computing and research labs—including high-performance DGX workstations for AI/ML—and partners with global institutions for student exchange. Mandatory industry internships and a centralized Placement & Training Cell have driven a CSE placement consistency of around 94–100% over the past three years, with 214 recruiters making 505 offers to 449 CSE students in 2024.

The Institute of Engineering & Technology Lucknow is a fully residential, state-funded autonomous college under AKTU, recognized by AICTE and NBA. Established in 1984, its CSE department offers a JEE(Main)-based B.Tech, supported by experienced faculty, state-of-the-art computing and networking labs, and two centres of excellence in green hydrogen and electric vehicles for interdisciplinary exposure. A dedicated Training & Placement Cell and robust industry MoUs yield nearly 100% CSE placement rates with an average package around 8 LPA over the last three years, engaging top recruiters such as TCS, Wipro and Adobe.

For global research collaborations, superior AI/ML infrastructure, and slightly higher placement consistency, the recommendation is JIIT Noida CSE. If you prefer a government-backed institute with extensive interdisciplinary labs, residential campus life, and near-100% placements in a core-state environment, the recommendation shifts to IET Lucknow CSE. All the BEST for Admission & a Prosperous Future!

Follow RediffGURUS to Know More on 'Careers | Money | Health | Relationships'.

...Read more

Nayagam P

Nayagam P P  |8244 Answers  |Ask -

Career Counsellor - Answered on Jul 08, 2025

Asked by Anonymous - Jul 08, 2025Hindi
Career
I am going take admission in pvt cllg, What should i choose? Thapar, LPU or lnmit jaipur... I want to do cse..? I am very confused
Ans: Thapar University’s B.Tech CSE, a NAAC A+ accredited programme established in 1956, features PhD-qualified faculty, industry-standard software and hardware labs, mandatory semester-long internships via 334 recruiters, and achieved approximately 96% CSE placement consistency with an average package of ?11.9 LPA over the past three years. Lovely Professional University’s B.Tech CSE, NBA-accredited and LPUNEST/JEE-Main eligible, integrates hackathons, live projects and industry-collaborative labs, offers bridging mathematics for non-PCM students, and reports around 80% placement consistency with an average package near ?8 LPA and summer internships from Cognizant, Microsoft and Infosys. LNMIIT Jaipur’s CSE, a public-private NAAC-accredited institute founded in 2002, provides flexible electives in AI/ML and cybersecurity, 100-acre campus infrastructure, a dedicated placement cell securing a 93.9% placement rate and ?13.73 LPA average package, backed by partnerships with IBM, Wipro and Amazon.

For proven high-tier placements, rigorous core curriculum and premier alumni network, recommendation is Thapar University CSE. If flexible project-based learning with robust internship integration appeals more, choose LNMIIT Jaipur CSE. For broad-based labs with strong industry tie-ups and scholarship support, opt for Lovely Professional University CSE. All the BEST for Admission & a Prosperous Future!

Follow RediffGURUS to Know More on 'Careers | Money | Health | Relationships'.

...Read more

Nayagam P

Nayagam P P  |8244 Answers  |Ask -

Career Counsellor - Answered on Jul 08, 2025

Asked by Anonymous - Jul 08, 2025Hindi
Nayagam P

Nayagam P P  |8244 Answers  |Ask -

Career Counsellor - Answered on Jul 08, 2025

Asked by Anonymous - Jul 08, 2025Hindi
Career
Hi Sir, I am Ajay from Bangalore. My son got admission into Mathematics and computing in RGIPT, Amethi. Also he is getting admission into IIST, Thiruvananthapuram. Which one he can select sir. Waiting for your reply. Thanking you sir.
Ans: Ajay Sir, Rajiv Gandhi Institute of Petroleum Technology’s B.Tech in Mathematics & Computing is a new National Importance programme (NIRF #80) blending deep theoretical coursework, specializations in mathematical modeling, AI and financial mathematics, and PSU-aligned recruitment (ONGC, IOCL, BPCL) (subject to eligibility criteria & recruitment policies which vary every year) with average B.Tech packages of ?9.4 LPA and the highest up to ?22 LPA. The multidisciplinary labs and project work prepare students for roles in the software and energy sectors; however, since this is a newer course, it has fewer alumni and its industry partnerships are still developing. Indian Institute of Space Science & Technology delivers focused B.Tech specializations in Aerospace and Avionics with direct ISRO absorption for 62% of graduates (CGPA ≥ 7.5) under a three-year service bond, and 38 non-ISRO placements (29% of B.Tech cohort) averaging ?10.5 LPA with top offers at ?16.6 LPA. Its state-of-the-art space-tech labs, guaranteed internships at ISRO centres and strong research orientation foster niche space-science careers but involve rural campus distance and binding service obligation.

For broad computational careers and flexible industry options, the recommendation is RGIPT Mathematics & Computing. If a direct ISRO pathway, specialized space-tech training and research immersion are priorities, the recommendation shifts to IIST Thiruvananthapuram B.Tech. (Important Note: Please be aware that absorption into ISRO is not guaranteed, as its recruitment policies may vary from year to year and are also subject to additional eligibility conditions). All the BEST for Admission & a Prosperous Future!

Follow RediffGURUS to Know More on 'Careers | Money | Health | Relationships'.

...Read more

DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Investment in securities market are subject to market risks. Read all the related document carefully before investing. The securities quoted are for illustration only and are not recommendatory. Users are advised to pursue the information provided by the rediffGURU only as a source of information and as a point of reference and to rely on their own judgement when making a decision. RediffGURUS is an intermediary as per India's Information Technology Act.

Close  

You haven't logged in yet. To ask a question, Please Log in below
Login

A verification OTP will be sent to this
Mobile Number / Email

Enter OTP
A 6 digit code has been sent to

Resend OTP in120seconds

Dear User, You have not registered yet. Please register by filling the fields below to get expert answers from our Gurus
Sign up

By signing up, you agree to our
Terms & Conditions and Privacy Policy

Already have an account?

Enter OTP
A 6 digit code has been sent to Mobile

Resend OTP in120seconds

x