Mid cap Mutual funds is a type of investment fund which focuses its investment in the companies which are having a mid-range of capitalization in the stock market. The word ‘cap’ in mid-cap mutual fund investment is stands for the size of the companies which are listed and having a capital range between Rs500 crore to Rs10000 crore. The size of the company is very much important when you are going to select equity portfolios because portfolios would have its own risk depending upon the size of the company.
Best Mid Cap mutual funds plans
- L&T Midcap Funds(G) -Direct Plans
- DSP MidCap Fund(G) -Direct Plans
- Invesco Midcap Fund (G) -Direct Plans
- Franklin India Prima Fund(G) -Direct
- HDFC Midcap 0pp Fund(G) -Direct
Midcap invests in a company who has the potential to become a large company in the coming days.
Who should invest?
Investors who want to achieve more prominent in their life and risks are also high as compared to large-cap funds should invest in mid-cap mutual fund investment. If the investor is ready to face the volatility of the stock, then they should go for mid-cap mutual funds. But some investors are not ready to take high-risk, so they go for the large-cap funds. But being volatile on the stock index, mid-cap funds give steep growth and fast earnings.
Benefits of Mid-cap Funds
- Volatility of stock
The stocks are very volatile, and there is greater price movement in this as compared to large-cap funds. There is high-risk appetite, but it also gives higher returns.
- Under followed in stock market
Mid-cap funds are relatively underfollowed in the stock market and this they provide more excellent opportunity to the investors to invest and the investors get high returns on their investment.
How to assess your Midcap mutual funds?
To assess your Midcap mutual funds, you can use different parameters. Let’s have a look at these parameters.
- Performance and risk analysis
It is the most important method to analyse you are Mid Cap mutual funds. Just go through past fund performance during short term and long-term period like 1years to 5 years before investing.
- Assessment of portfolio quality
The investors should check their portfolio and it should be well diversified. Also, make sure to note down the portfolio turnover ratio and expenses as well as fund manager performance over time, from the investor’s point of view. Also, make sure to ensure that the record of mutual fund house should be consistent over a different scheme and different period.
Things to consider as an investor in mid-cap mutual fund investment
- The performance of the Mid Cap Mutual Fund
- Investment Horizon
- Expense ratio
- Your age
- A quality fund house
- Your risk appetite
- Picking up an experienced and well-trained fund manager
- Tax planning
Mutual fund investments are subject to market risks. Please read the scheme information and other related documents carefully before investing.