- Abakkus Small Cap Fund and Helios Small Cap Fund manage similar assets but differ in portfolio style
- Abakkus holds 62 stocks with 14% cash, Helios holds 82 stocks and is fully invested
- Abakkus focuses on financials, healthcare, industrials; Helios on manufacturing, defence, electronics
India's small-cap mutual fund space has two relatively new entrants attracting investor attention — Abakkus Small Cap Fund and Helios Small Cap Fund. While both funds manage similar assets of around Rs 1,000 crore and were launched within months of each other, their portfolio construction could hardly be more different. According to Santosh Joseph, Founder of Germinate Investor Services, the similarities largely end with the fund size.
Abakkus, launched in March 2026, runs a concentrated portfolio of 62 stocks with nearly 14% cash and a small allocation to large-cap stocks.
Helios, which launched in November 2025, holds about 82 stocks, is almost fully invested, and has no large-cap exposure.
"Abakkus is going for active selection and conviction, while Helios is going for active elimination, which is largely their style," he said.
Sectoral Positioning and Overlap
Abakkus has higher exposure to financials, healthcare and industrials, while Helios is tilted towards manufacturing, defence and electronics.
The overlap between the two portfolios is also minimal. The top 10 holdings are entirely different, and overall portfolio overlap is only about 10%.
For investors, that creates an unusual opportunity. "Rather than being comparative, the complementary sense is that none of the top 10 holdings are common. You are actually spoilt for choice," Joseph said. "If it permits, you are better off by selecting both."
His suggested allocation is a simple 50-50 split for most investors.
Cash Holding and Flexibility
While Helios remained almost fully invested and participated in the recent small-cap rebound, Abakkus retained significant cash reserves. "Holding cash is a drag in a fast bull run," Joseph noted. "But in a typical small-cap portfolio, cash is often used to overcome valuation concerns and keep powder dry to seize opportunities."
The larger question for investors is whether to choose these newer funds over established small-cap schemes with decade-long track records. Joseph believes the answer depends on what investors value more.
Older funds offer proven performance across market cycles but are often significantly larger in size. "This is a sweet spot to enter into a small-cap fund with smaller size because they can buy meaningful allocations to the stocks they want," he said.
Still, investors are effectively backing the fund managers rather than a track record. That may not be a bad bet. Joseph points out that both fund houses are led by experienced market veterans with long investing histories.
For investors willing to tolerate the volatility that comes with small-cap investing, he sees both funds as credible long-term options. "India is a very sweet spot for small-cap stock picking," he said. "If you believe these portfolio managers have the pedigree to deliver, both of them are winners on hand."
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