Should I exit my fund if it becomes too large after merger?
- Tanmay
I think most of the investors should worry when some of the midcap or smallcap funds merge because this is where the fund manager will have to excersise constraint or turning big will be an impediment to their performence. But don't jump on this before hand and take this as and when it comes. Let us see how fund houses are classifying their funds because many fund houses would like to wriggle out of it by re-classifying funds or re-stating their strategy as many fund categories have been specified and many fund companies will not have as many funds. So by re-positioning their funds, they will be able to avoid fund merger and there will be few funds which will face this situation. You should worry if you are owning a great smallcap fund and if the fund company has few other smallcap funds which will get merged into it.