Mid-cap mutual funds invest in mid-cap companies.Which means, these mutual funds invest in companies that are between 100 and 250 on the capitalization charts.

When an investor invests in mid-caps for a long-term, they prefer those companies that they think will be tomorrow’s runaway successes. Traditionally, mid-caps are mid-sized companies, which, if run well with a good business strategy can become tomorrow’s leaders or large-caps.

Institutional investors like mutual funds and Foreign Institutional Investors (FIIs) are increasingly investing in top mid-caps and mid-cap funds to enhance their gains in the equity markets.

So, let’s look into top 7 mid-cap funds available in Indian market.

Best Mid-Cap Mutual Funds to Consider Investing in 2019
Fund Name 1Y 3Y 5Y Expense Ratio Turnover Ratio Category Risk
L&T Midcap Fund - Direct - Growth -6.93% 13.95% 16.2% 0.92% 19% Equity
(Mid Cap)
High
Kotak Emerging Equity Scheme - Direct - Growth -1.37% 12.22% 17.76% 0.7% 19% Equity
(Mid Cap)
Moderately High
Principal Emerging Bluechip Fund - Direct - Growth -3.22% 14.6% 16.86% 0.86% 67% Equity
(Large & Mid Cap)
Moderately High
HDFC Mid-Cap Opportunities Fund - Direct - Growth -4.5% 12.16% 14.49% 1.15% 58% Equity
(Mid Cap)
Moderately High
Axis Midcap Fund - Direct - Growth 5.35% 14.76% 14.15% 0.9% 14% Equity
(Mid Cap)
Moderately High
Invesco India Mid Cap Fund - Direct - Growth 1.13% 13.37% 15.35% 0.99% 17% Equity
(Mid Cap)
Moderately High
Sundaram Mid Cap Fund - Direct - Growth -8.31% 9.2% 13.69% 1.16% 45% Equity
(Mid Cap)
Moderately High

Best Mid-Cap Mutual Funds to Consider Investing in 2019 – Details

1. L&T Midcap Fund

This is a mid cap mutual fund launched on August 09, 2004. It is a high-risk fund and has given a return of 21.75% since its launch.

Key Details

Rating by Groww 5 star
AUM (Fund Size) ₹ 1,323
Minimum SIP ₹ 500
Performance w.r.t its Benchmark Has consistently outperformed its benchmark Nifty Free Float Midcap 100 since its launch.
Age of the fund 13 years old
Expense Ratio 1.72%

The fund’s asset allocation reveals a 25-30% allocation to small-cap stocks, about 10-11% lower than the small-cap category, while mid-cap allocation is about 55%. The remaining is in large-cap category.

Holding

L&T mid cap fund

2. Kotak Emerging Equity Scheme

This is a mid cap equity oriented mutual fund launched on January 01, 2013. It is a fund with moderately high risk and have given a return of 23.83% since its launch.

Key Details

Rating by Groww 4 star
AUM (Fund Size) ₹ 3021
Minimum SIP ₹ 1000
Performance w.r.t its Benchmark Has consistently outperformed its benchmark S&P BSE Mid Small Cap Index since its launch.
Age of the fund 5 years old
Expense Ratio 1.1%

The scheme aims to generate long-term capital appreciation from a portfolio of equity and equity related securities, by investing predominantly in mid and small cap companies.

Holdings

Kotak mid cap fund holding

3. HDFC Mid-Cap Opportunities Fund

This is a fund was launched on January 01, 2013. It is a fund with moderately high risk and has given a return of 25.05% since its launch.

Key Details

Rating by Groww 4 star
AUM (Fund Size) ₹ 120959
Minimum SIP ₹ 500
Performance w.r.t its Benchmark Has consistently outperformed its benchmark NIFTY Midcap 100 TRI since its launch.
Age of the fund 5 years old
Expense Ratio 1.07%

A remarkably consistent performer in a very whimsical category, this fund has stayed put at a four star rating for the last seven years.

This fund usually invest about 55 to 65 per cent in mid-cap companies, the fund has tended to invest about 30 per cent in large-caps, with a rest investment in small-caps. The fund follows a growth at a reasonable price strategy.

Holdings

HDFC Mid-Cap Opportunities Fund

4. Axis Midcap Fund – Direct – Growth

This is currently considered one of the best funds in the mid cap segment:

Key information

Launch Date 1 January 2013
NAV (14 Sep 2018) ₹39.4
Plan Type Direct
Rating by Groww 5 Star
AUM (Fund Size) ₹1,396 Cr
Riskometer Moderately High
Minimum SIP ₹1,000
Minimum SWP ₹500
Performance w.r.t its Benchmark Has consistently outperformed its benchmark S&P BSE Mid Cap TRI since its launch.
Age of the fund 5 years old
Expense Ratio 1.38%
Exit Load If redeemed bet. 0 Year to 1 Year; Exit Load is 1%;
Type  Open Ended

Holding Analysis

1.The top 5 portfolio holdings of the fund include GRUH Finance Ltd., Bajaj Finance Ltd., Page Industries Ltd., City Union Bank Ltd. and Supreme Industries Ltd.

2.The holdings are balanced across various sectors with maximum weightage given to financial services (32%) followed by consumer goods (18%).

5. Invesco India Mid Cap Fund – Direct – Growth

Another top rated fund in the mid-cap category, this fund has given the highest returns in the last 5 years.

Key Details

Launch Date 1 January 2013
NAV (14 Sep 2018) ₹54.5
Plan Type Direct
Rating by Groww 5 Star
AUM (Fund Size) ₹179 Cr
Riskometer Moderately High
Minimum SIP ₹1,000
Minimum SWP ₹1,000
Performance w.r.t its Benchmark Has consistently outperformed its benchmark NIFTY Midcap 100 TRI since its launch.
Age of the fund 5 years old
Expense Ratio 1.03%
Exit Load If redeemed bet. 0 Year to 1 Year; Exit Load is 1%;
Type  Open Ended

Holding Analysis

1.The top 5 portfolio holdings of the fund include United Breweries Ltd., RBL Bank Ltd., MRF Ltd., Sanofi India Ltd, and Schaeffler India Ltd.

2.The holdings are balanced across various sectors with maximum weightage given to financial services (17.6%) followed by consumer goods (13.9%).

6. Sundaram Mid Cap Fund – Direct – Growth

This is a decent fund and what’s more, you can invest in this fund with a minimum SIP of just ₹250!

Key Details

Launch Date 1 January 2013
NAV (14 Sep 2018) ₹507
Plan Type Direct
Rating by Groww 4 Star
AUM (Fund Size) ₹6,039 Cr
Riskometer High
Minimum SIP ₹250
Minimum SWP ₹1,000
Performance w.r.t its Benchmark Has consistently outperformed its benchmark S&P BSE Mid Cap TRI since its launch.
Age of the fund 5 years old
Expense Ratio 1.40%
Exit Load If redeemed bet. 0 Year to 1 Year; Exit Load is 1%;
Type  Open Ended

Holding Analysis

1.The top 5 portfolio holdings of the fund include The Ramco Cements Ltd., Sundaram Clayton Ltd., Quess Corp Ltd., Mahindra CIE Automotive Ltd. and Schaeffler India Ltd.

2.The holdings are balanced across various sectors with maximum weightage given to financial Services (17.4%) followed by industrial manufacturing (16.5%).

What are Mid-Cap Funds?

In mid-cap funds, a large portion of the investment is done in companies with medium market capitalization.

Mid-sized companies fall somewhere between small and large-sized companies and are very popular among investors, because they are considered compact.

In mid-cap funds, minimum investment in equity & equity related instruments of mid-cap companies have to be 65% of total assets.

When one invests in mid-cap funds for the long-term, he may be investing in companies that could become tomorrow’s runaway success stories.

Advantages of Mid-Cap Funds

Some  key benefits of investing in mid-cap funds are as follows:

1.Good Returns

Mid cap funds have outperformed large-cap funds, and the trend is not likely to change anytime soon.

Mid-cap funds are less risky and volatile as compared to small-cap funds, yet provide better high growth opportunities as compared to a large-cap fund.

2.Liquidity

Mid-cap funds are more liquid, as compared to small-cap funds.

Mid-cap companies have been in the business long enough to avoid blunders usually made by small-cap companies.

Things to Remember

Don’t just run for returns from investment for investing in mutual funds. There are a lot of factors you should look into before selecting a fund which will match your investment goals.

Following the 3 things you should always remember before investing in Mutual Funds :

  • Higher rates: don’t blindly invest in the fund with the highest returns. Invest based on the duration you want to invest for.
  • Every person’s financial condition is different. Evaluate the funds you invest in yourself – don’t invest in a fund because of its popularity.
  • Review your investment from time to time but not too often. Once a few weeks is good enough.

To ensure that the fund is in good hands, choose a fund house having fund manager with a good amount of experience managing small/mid cap funds and associated with these funds for some good numbers of years.

Happy Investing!

Disclaimer:the views expressed here are of the author and do not reflect those of Groww.