Mid-Cap Fund Returns 82% in 1 Year: Is It Too Risky to Invest In? Learn More

Considering Mutual Fund Investment Today? Mid Cap Funds Can Be a Good Option

Investing in mid-cap equity funds can be a promising choice if you are contemplating mutual fund investments today. This category of funds has delivered returns exceeding 82% in the last 1 year, indicating its potential for higher returns. Opting for mid-cap equity funds can potentially yield you better profits while bearing some level of risk.

Understanding Mid Cap Mutual Funds

Mid-cap mutual funds are funds that primarily invest in shares of mid-cap companies. Mid-cap companies are those whose market capitalization is more than ₹5,000 crores but less than ₹20,000 crores. From a market capitalization perspective, companies ranked between 101 and 200 are considered mid-cap companies.

Take Risks If You Can

Mid-cap funds tend to carry higher risks compared to large-cap funds. Therefore, those who can afford to take more risks in their investments should consider investing in these funds. Additionally, they offer good returns for long-term investments. In such scenarios, if you are looking to invest for more than 5 years, you can consider investing in them.

You Can Allocate 20-30% of Your Portfolio

According to experts, allocating 20 to 30% of your portfolio in mid-cap funds is advisable. This means that if you have a total of ₹100 to invest, you can allocate ₹20 to ₹30 in these funds. Investing a portion of your portfolio in mid-cap funds can be beneficial for long-term growth.

Investing through SIP Can Be More Beneficial

Instead of investing a lump sum amount in mutual funds, it is advisable to invest systematically through a Systematic Investment Plan (SIP). Through SIP, you invest a fixed amount every month. This reduces the risk significantly because it is less affected by market volatility.

Mid Cap Funds Have Delivered Better Returns in Recent Years

Fund NameLatest 1-Year Return3-Year CAGR5-Year CAGR
Quant Mid Cap Fund82.11%35.91%36.34%
Mahindra Manulife Mid Cap Fund68.69%29.96%29.06%
Nippon India Growth Fund60.72%30.53%27.07%
Motilal Oswal Mid Cap Fund58.82%37.69%29.34%
HDFC Mid-Cap Opportunities Fund58.68%29.82%26.41%

Source: Grow, May 25, 2024

Akash Shrivastav

My name is Akash Shrivastav, and I am a Blogger. I have 8 years of experience in blogging for Finance, Business, Investment, Stock Market, Cryptocurreny and more. Through my writing, I aim to provide readers with insightful and informative content.