In recent years, small-cap mutual funds in India faced challenges due to excessive liquidity and stretched valuations, leading many fund managers to restrict inflows. However, some funds have recently reopened, including the Tata Small Cap Fund, which resumed lump sum investments in April 2023 after a nearly three-year hiatus. Similarly, the ICICI Prudential Smallcap Fund reopened in January 2024, prompted by a correction in the market that created better entry points. Conversely, larger funds like the Nippon India Small Cap Fund, valued at ₹62,000 crore (approximately $7.5 billion USD), have kept lump sum investments closed since July 2023, although they increased the limit for systematic investment plans (SIPs) to ₹2 lakh (approximately $2,400 USD) per installment. The SBI Small Cap Fund, with ₹32,000 crore (approximately $3.9 billion USD) in assets, has maintained its closure for lump sum investments for over three years, allowing only SIP contributions of up to ₹25,000 (approximately $300 USD) per month. Experts emphasize that the gating of funds should be viewed as a risk management strategy rather than a direct indicator of market valuations. Investors are encouraged to focus on their overall portfolio strategy and consider SIPs as a preferred investment method in the small-cap segment.