DynaSIF Equity Ex Top-100 Long-Short Fund: Long and Short strategies for long-term capital appreciation

The 360 ONE MF has launched an investment strategy under a specialized investment fund (SIF), the DynaSIF Equity Ex Top-100 Long-Short Fund. SIFs offer sophisticated investment strategies, including the use of derivatives, while providing operational ease, transparency, an investment ticket (Rs 10 lakh minimum investment) and tax efficiency. DynaSIF Equity Ex Top-100 Long-Short Fund will predominantly invest in mid-cap and small-cap stocks. In this article, we will review this SIF.

Why invest in Long Short Funds?

• Potential to participate in All Markets


• Aim for Reduced Beta and volatility: Combining long and short positions may balance risks and returns, reducing portfolio volatility


• Flexibility and Tactical Allocation: Fund managers may have the flexibility to adjust exposures to long-short positions (e.g., increase long / decreasing short and vice versa), sectors, and valuations to respond to changing market conditions.


• Risk-Adjusted Returns


• Diversification Benefits: Short positions in SIF portfolios may provide additional diversification to the portfolio.

Why invest in the mid and small-cap segment?

Opportunity beyond the Top 100

• Market Breadth Is Widening: Stocks beyond the top 100 are increasingly driving index-level moves. The chart below shows that the Mid-caps delivered 20.7% CAGR vs 12.2% for large caps over 5 years, while the small-caps delivered a 19% CAGR. The share of the top 10 companies in total market value has fallen from 29% in 2021 to 22%
  
  

  

  Source: NSE / BSE Index data, 5-year CAGR as of 30^th April 2021 to 30^th April 2026. Mid and small-cap stocks are subject to higher volatility, liquidity risk, and market fluctuations compared to large-cap stocks.



• Mid and small-caps have more access to varied sectors: India's fastest-growing themes live almost exclusively in the mid & small-cap space
  

  Sectors like Media, Entertainment, Diversified, and Publication can only be accessed through mid and small-caps.

  
  

  



• Historically, mid and small caps offered faster expansion: Market Cap of Mid and Small cap companies have grown higher than that of large caps
  
  

  



• The majority of stocks that grew more than 10x were beyond the Top 100: Majority of newly listed mid- and small-cap companies have scaled more than large-cap ones. In fact, out of a total universe of companies listed between 2020 and 2026, 128 were small-cap companies that went on to become mid-cap and large-cap companies during the period. 13 small-cap companies moved to the mid-cap category, and 1 moved to the large-cap category. This data shows the immense growth potential of mid-cap and small-cap companies.
  
  

  

  Source: Internal research, NSE, BSE for Index levels. Mid and small cap are subject to higher volatility, liquidity risk, andmarket fluctuations as compared to large cap. Source: Bloomberg & Internal Research. Graphs for illustrative purpose only and to explain the concept and should not be considered as investment advice or future recommendations.

The DynaSIF Equity Ex Top-100 Long-Short Fund

The DynaSIF Equity Ex Top-100 Long-Short Fund will open for subscription from 5^th June 2026 to 19^th June 2026. The fund is managed by Mr. Mayur Patel, Mr Harsh Agarwal, Mr. Milan Mody, and the co-fund manager is Mr. Pranav Mise.

Investment Philosophy

• Investment of 70-80% CORE Small & Mid-Caps (Ex Top 100)
  
  

  The fund managers pass each stock through an unrelenting scrutiny of the following parameters.

  
  

  



• Designed for Both Sides of the Market
  
  

  In every market, winners and losers coexist. The DynaSIF Equity Ex Top-100 Long-Short Fund(SIF) aims to capture alphas from both

  
  

  

Portfolio Construction

Distinct buckets are created to help build a robust portfolio.

The allocation is:

• Mid and Small Cap Equity (Beyond Top 100): This category always holds the largest position and is India's real growth engine. Includes allocation to REITs


• Top 100 Equity (0-35%): Opportunistic large cap when valuation is favourable


• Unhedged Shorts (Ex Top-100) (0-25%): Derivatives aim to capture returns from faltering businesses


• Debt Instruments (0-25%): T-Bills, money market & corporate bonds


• InvITs (0-25%): Aims to generate alternative income from real assets

Why invest in DynaSIF Equity Ex Top-100 Long-Short Fund now?

The market has rebounded after a ceasefire between the US and Iran. On the positive side, the end of war in the Middle East will improve risk sentiments. The long-term outlook for Indian equities remains strong due to India’s strong macroeconomic fundamentals (e.g. robust GDP growth, narrowing fiscal deficit, etc), continued capex spending by the Government, and revival of consumption demand post GST rate cuts. In the short term, concerns about resumption or re-escalation of the war in the Persian Gulf, continued disruption to oil and gas flows, high crude oil prices, volatile geo-political dynamics, and continuing FII outflows are headwinds for the market. The current stalemate may continue or intensify if progress is not made in negotiations between the two sides. In uncertain market conditions, the DynaSIF Equity Ex Top 100 Long-Short Fund can preserve investors’ capital, reduce portfolio volatility and offer superior risk-adjusted returns over the entire investment cycle.

Who can find the DynaSIF Equity Ex Top-100 Long-Short Fund suitable?

• Sophisticated investors with a good understanding of financial markets and seeking exposure to long-short equity strategies with a minimum investment of ₹10 lakh


• Investors seeking exposure to mid and small-cap segments


• Investors with a very high-risk appetite.

Investors should consult with their financial advisors or mutual fund distributors if the DynaSIF Equity Ex Top-100 Long-Short Fundis suitable for their investment needs.