Investing in mutual funds has always been the choice of the investor who wishes to delegate the research part and enjoy the market-linked returns. Mutual funds are a diverse investment avenue. But among the various categories of mutual funds, mid-cap mutual funds have gained popularity among investors seeking higher growth potential. They have become the go-to investment avenues for investors who do not want to stand at the extremes, whether in terms of returns or risks. Before you start investing in the best mid-cap mutual funds with Koshex, let’s understand what mid-cap funds are and which ones are the best.
What are Mid-Cap Mutual Funds?
Mid-cap mutual funds are a category of mutual funds that primarily invest in the stocks of mid-sized companies. The market capitalization of these companies is between Rs. 5,000 crore to Rs. 20,000 crore. These companies typically fall between large-cap and small-cap companies in terms of market capitalization. They are in the initial to mid-stage of their growth phase and hold the potential to provide lucrative returns.
Why Invest in Mid-Cap Mutual Funds?
Investing in top-performing mid-cap mutual funds offers several advantages to taxpayers, including but not limited to the following:
- Growth Potential: Mid-cap companies have the potential for significant growth in the coming years. This makes them an attractive investment destination for investors looking for higher returns over the long term.
- Diversification: Mid-cap funds provide significant diversification benefits to you by spreading risk across multiple mid-cap company stocks.
- Better Performance: Mid-cap stocks often perform well as compared to their stable counterparts, i.e., large cappers. When the economy is booming, these companies tend to grow at a faster pace.
- Professional Management: Mid-cap mutual funds are professionally managed by expert fund managers. They research, analyze, and select the best mid-cap stocks for the portfolio. Further, they also monitor the performance of the stocks included, add newer stocks, and eliminate the underperforming ones.
10 Best Mid-Cap Mutual Funds to Invest in 2023
Here are the top 10 best mid-cap mutual funds to invest in 2023, as per Moneycontrol that should form part of your portfolio (as on 18 September 2023):
1) Quant Mid Cap Fund -Growth
This fund invests 67.43% of its funds in domestic equities, of which 18.92% are in mid-cap stocks. With a fund size of Rs. 2788.8 crore, the fund provides one of the highest returns in this category. The fund has completed 10 years since inception and has an expense ratio of 1.95%.
2) Motilal Oswal Mid Cap Fund -Growth
This fund invests 95.09% of its funds in domestic equities, of which 18.67% are in mid-cap stocks. With a fund size of Rs. 5734.93 crore, this fund is suitable for investors looking for high returns. The fund has completed 8+ years since inception and has an expense ratio of 1.82%.
3) Nippon India Growth Fund -Growth
This fund invests 97.42% of its funds in domestic equities, of which 48.42% are in mid-cap stocks. With a fund size of Rs. 18343.36 crore, it has completed 10 years since inception and has an expense ratio of 1.71%.
4) Kotak Emerging Equity Fund -Growth
This fund invests 92.97% of its funds in domestic equities, of which 53.78% are in mid-cap stocks. The fund’s total assets under management are Rs. 33091.23 crore as of September 2023. The fund has completed 10 years since inception and has an expense ratio of 1.52%.
5) Mahindra Manulife Mid Cap Fund – Regular Plan-Growth
This fund invests 93.2% of its funds in domestic equities, of which 44.64% are in mid-cap stock. The fund’s total assets under management are Rs. 1475.97 crore as of September 2023. The fund has completed 4+ years since inception and has an expense ratio of 2.07%.
6) SBI Magnum Mid Cap Fund – Regular Plan-Growth
This fund invests 93.12% of its funds in domestic equities, of which 41.87% are in mid-cap stocks. The fund’s total assets under management are Rs. 12555.2 crore as of September 2023. The fund has completed 10 years since inception and has an expense ratio of 1.75%.
7) HDFC Mid Cap Opportunities Fund -Growth
This fund invests 91.43% of its funds in domestic equities, of which 55.42% are in mid-cap stocks. The fund’s total assets under management are Rs. 47236.04 crore as of September 2023. The fund has completed 10 years since inception and has an expense ratio of 1.53%.
8) Canara Robeco Equity Tax Saver Fund – Regular Plan-Growth
This fund invests 95.84% of its funds in domestic equities, of which 11.87% are in mid-cap stocks. The fund’s total assets under management are Rs. 5981.03 crore as of September 2023. The fund has completed 10 years since inception and has an expense ratio of 1.75%.
9) UTI Value Opportunities Fund -Growth
This fund invests 97.84% of its funds in domestic equities, of which 15.56% are in mid-cap stocks. The fund’s total assets under management are Rs. 7539.87 crore as of September 2023. The fund has completed 10 years since inception and has an expense ratio of 1.85%.
10) UTI Mastershare Unit Scheme – Regular Plan-Growth
This fund invests 97.57% of its funds in domestic equities, of which 7.84% are in mid-cap stocks. The fund’s total assets under management are Rs. 11314.26 crore as of September 2023. The fund has completed 10 years since inception and has an expense ratio of 1.76%.
Above were the top-performing mid-cap mutual funds that have demonstrated strong historical performance and are managed by experienced fund managers. However, it’s crucial to consider factors such as expense ratios, risk tolerance, and investment goals before making your investment decision. Also, the performance of mutual funds can change over time, so it’s essential to do your research, monitor your investments, and consult with a financial advisor before investing.
Also read: 5 Ways To Boost Portfolio Returns
In a Nutshell
Mid-cap mutual funds can be a valuable addition to your investment portfolio, as they offer the potential for higher returns and diversification. However, they also come with increased volatility and risk, so it’s essential to assess your risk tolerance, and investment horizon before allocating funds to this category.
The above list highlights some of the best mid-cap mutual funds to invest in 2023 that you can include in your portfolio. Diversifying your investments across a mix of asset classes, including mid-cap funds can help you achieve your long-term financial goals. At the same time, it’s important to select the right platform for investment.
Koshex has always remained the investor’s choice for investing in different asset classes like mutual funds, smart deposits, and digital gold. You can choose from 5,000 different funds to select the ideal fund that suits your investment goals and preferences. Sign up now with Koshex!
Frequently Asked Questions
Q: What is the minimum investment amount for mid-cap mutual funds?
A: The minimum investment amount for mid-cap mutual funds varies from one fund to another. However, some mutual funds allow investments through Systematic Investment Plans (SIPs) starting as low as Rs. 500. The amount may vary for lump sum investments.
Q: What is the ideal investment horizon for mid-cap mutual funds?
A: A mid to long-term investment horizon, typically between 4-5 years or more, is often recommended for mid-cap mutual funds. Mid-cap mutual funds are less volatile as compared to small-cap ones but are more volatile than large-cap.
Q: Are mid-cap mutual funds riskier than large-cap funds?
A: Yes. Mid-cap mutual funds tend to be riskier than large-cap funds as the funds are invested in mid-cap companies that are in their growth stages. Further, mid-cap stocks also carry higher volatility.
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