Last Updated on Oct 2, 2023 by Anjali Chourasiya
Table of Contents
Best mid-cap mutual funds in 2023
| Name | AUM (Rs. in cr.) | Expense Ratio (%) | Volatility (%) | 3Y CAGR (%) | Minimum SIP (Rs.) | Minimum Lumpsum (Rs.) | Exit Load (%) |
| Quant Mid Cap Fund | 2,531.32 | 0.76 | 14.47 | 40.55 | 0.00 | 5,000.00 | 0.50 |
| Motilal Oswal Midcap Fund | 5,236.88 | 0.70 | 11.81 | 37.84 | 1,500.00 | 500.00 | 1.00 |
| SBI Magnum Midcap Fund | 12,555.20 | 0.90 | 9.62 | 35.48 | 1,500.00 | 5,000.00 | 1.00 |
| HDFC Mid-Cap Opportunities Fund | 47,236.04 | 0.86 | 11.38 | 35.39 | 100.00 | 100.00 | 1.00 |
| Nippon India Growth Fund | 18,343.36 | 0.94 | 11.06 | 34.49 | 0.00 | 100.00 | 1.00 |
| Mahindra Manulife Mid Cap Fund | 1,385.23 | 0.56 | 11.62 | 34.30 | 0.00 | 1,000.00 | 1.00 |
| Mirae Asset Midcap Fund | 11,919.25 | 0.65 | 10.24 | 34.12 | 1,000.00 | 5,000.00 | 1.00 |
| Edelweiss Mid Cap Fund | 3,448.91 | 0.45 | 11.26 | 32.76 | 1,000.00 | 5,000.00 | 1.00 |
| Kotak Emerging Equity Fund | 31,388.88 | 0.37 | 9.16 | 32.32 | 0.00 | 100.00 | 1.00 |
| PGIM India Midcap Opp Fund | 9,392.69 | 0.41 | 10.00 | 31.22 | 1,000.00 | 5,000.00 | 0.50 |
Note: The data is from 1st October 2023. It is filtered using Tickertape Mutual Fund Screener with the following parameters-
- Category > Equity > Mid-cap fund
- AUM (Assets Under Management)
- 3-yr CAGR: Set to high – Sort from highest to lowest
- Expense Ratio
- Minimum Lumpsum
- Minimum SIP
- Exit Load
About the 3 best mid-cap funds in India
Quant Mid Cap Fund
Quant Money Managers Limited (AMC) was established in 1995 and approved by SEBI to act as an Asset Management Company for the Quant Mutual Fund in 2017. The portfolio of Quant Mid Cap Fund includes investments in sectors such as Public Banks, Oil and Gas – Refining and Marketing, Private Banks, Auto Parts, etc. To learn about its performance and peer comparison, click here.
Motilal Oswal Midcap Fund
Motilal Oswal Asset Management Company Ltd. (MOAMC) is a public limited company incorporated in 2008. The fund boasts a PE ratio of 58.15% and is predominantly invested in sectors such as Two Wheelers, Diversified Chemicals, IT Services and Consulting, Specialized Finance, etc. Click here to learn about its performance and fund managers.
SBI Magnum Midcap Fund
With 30 years of experience in fund management, SBI Funds Management Ltd. (SBIFML) brings expertise in consistently delivering value to investors. SBI currently holds a 63% stake in SBIFMPL, and the SBI Magnum Midcap Fund portfolio includes investments in sectors such as Auto Parts, Textiles, Industry Machinery, Specialised Finance, etc. To know about the fund’s portfolio and tax implications, click here.
What is a mid-cap mutual fund?
Mid Cap mutual funds are equity mutual funds that primarily invest in mid-sized companies in India, with market capitalisation between Rs. 5,000 cr and Rs. 20,000 cr. These companies are ranked 101 to 250 based on their market capitalisation by the Securities and Exchange Board of India (SEBI).
Mid-cap mutual funds typically allocate at least 65% of their total assets to equity and equity-related securities of mid-cap companies, with the rest in debt securities or other classes. Mid-cap mutual funds offer the stability of large-cap companies with the growth potential of small-cap companies. With a diverse range of mid-cap stocks from various sectors, these professionally managed funds offer investors an opportunity to tap into the exciting world of mid-cap companies that are on the rise.
Advantages of investing in mid-cap mutual funds
- High growth return
Mid-cap companies have the potential to become future large-cap companies, offering significant growth potential. In addition, they can deliver substantial returns and outperform large-cap mutual funds as they did in the past.
- Portfolio diversification
Investing in mid-cap mutual funds allows you to explore investing in mid-cap companies with market capitalisations between Rs. 5,000 cr and Rs. 20,000 cr. These companies are ranked from 101 to 250 based on their market capitalisation by the Securities and Exchange Board of India (SEBI).
- Minimise risk
Investing in stocks of different mid-cap companies can cushion your investment portfolio against economic downturns and reduce risk compared to direct investment in individual stocks.
- Low investment amount
You can invest in the best mid-cap mutual funds for as low as Rs. 100. This allows investors who are still sceptical about investing in mutual funds to test the waters.
- Transparency
Mid-cap mutual funds are closely regulated by the Securities and Exchange Board of India (SEBI), which mandates them to disclose their Net Asset Values (NAVs), expense ratios, and month-end portfolios on their websites, ensuring transparency for investors.
- Managed by experienced fund managers
If you’re unsure about the best mid-cap stocks for your portfolio, the mid-cap mutual fund managers know exactly how you can generate exponential returns. By investing in mid-cap mutual funds, which are heavily invested in equity across numerous sectors of mid-sized companies, you can invest in some of the best mid-cap stocks.
Tax implications on mid-cap mutual funds
Since mid-cap mutual funds are classified as asset classes, understanding the taxation on mid-cap funds is crucial to assess your post-tax returns accurately. In addition, it helps you determine your investment gains when redeeming your investment.
The capital gains on mid-cap mutual funds are taxed based on the duration of your investment:
- Short-Term Capital Gain Tax (STCG): If you sell your investments within 1 yr, the gains are categorised as Short-Term Capital Gain (STCG) and are subject to a 15% tax.
- Long-Term Capital Gain Tax (LTCG): Conversely, gains from mid-cap investments held for over one year are considered Long-Term Capital Gain (LTCG). Up to Rs. 1 lakh in gains in a financial year are tax-free, while gains beyond Rs. 1 lakh are taxed at 10%.
Being aware of these tax implications on mid-cap funds allows you to accurately assess your potential returns after accounting for taxes.
Key things to consider before investing in mid-cap funds
- Long-term investment horizon: Since mid-cap mutual funds invest in companies that are yet to become large-cap, patience is required for potential growth. These companies may take time to recover during economic slowdowns, so a long-term investment horizon of 3 to 5 years is recommended to benefit from the investment fully.
- High risks: Mid-cap funds carry higher risks than large-cap funds but also offer the potential for market-beating returns. Only investors with an appetite for higher risks should consider investing in this category.
- Short to medium-term volatility: Mid-cap funds can be volatile in the short to medium term, with sudden drops in portfolio value. Only those willing to tolerate this volatility and fathom the risks involved should invest in mid-cap funds.
Conclusion
Understanding mid-cap mutual funds’ risks and potential rewards is crucial before making investment decisions. These funds may be suitable for investors with a long-term investment horizon, willingness to take higher risks, and comfort with short to medium-term volatility. On Tickertape Mutual Fund Screener, you can explore numerous mid-cap mutual funds that fit with your investment thesis.
FAQ
How to choose the right mid-cap mutual fund for the first-time investor?
Firstly, you should assess the portfolio for diversification, evaluate past performance like 3-yr and 5-yr CAGR, and review the fund manager’s historical performance. These aspects provide insights for informed investment decisions.
What are the average expected returns from mid-cap mutual funds?
If you’re invested in mid-cap mutual funds for 3 yr, you can earn a decent return in the 12-17% range.
Where do the fund managers of mid-cap funds invest?
Apart from investing in mid-cap companies, the fund managers of mid-cap funds invest in debt.
Are mid-cap funds high-risk?
Mid-cap mutual funds, being invested in equities, may exhibit short-term volatility. Nevertheless, over an extended period, the risk considerably decreases.
How long should I stay invested in mid-cap mutual funds?
It depends on the % of returns you are expecting against your investment. Since it is an investment in equity funds, you need to stay invested for at least 3 yr to earn decent returns.
As an investment fanatic, I’ve dabbled in early-stage startups, mutual funds, gold, stocks, smallcases, and real estate to identify which assets generate the highest ROI. At Tickertape, I’m dedicated to presenting my learning and providing insightful suggestions to help my readers make sound investment decision.
- Top 10 Green Energy Stocks in India (2024) - Apr 30, 2024
- Most Undervalued Stocks in India – 2024 - Apr 30, 2024
- Digital Gold vs Gold ETF vs SGB – Where to invest in 2024? - Apr 15, 2024
