Mid-cap funds have recently become the focus of heightened investor attention. In January 2024, these funds experienced an inflow of ₹2,061 crore, marking an increase from ₹1,393 crore in the previous month. This surge in investor interest can be substantiated by the stellar performances of some mid-cap funds, which have outpaced the benchmark S&P BSE Midcap TRI.
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The benchmark itself recorded a growth of 58.3% in the one year ending on February 23, 2024, according to Value Research.
The fund which performed the best was Quant Midcap Fund with a 65% return over the past year.
The assets of this fund stand at ₹4,858 crore, as per the report.
Following closely is the ITI Midcap Fund, which secured a 64.4% one-year return. This fund manages assets worth ₹681 crore as of January 31, 2024.
Mahindra Manulife Midcap Fund reported a 62.9% return in the same period. It manages assets totalling ₹2,074 crore.
Here's a look at all the mid-cap funds that outperformed the benchmark in the last one year:
| Fund name | 1-year return (%) | Assets Under Management (AUM) |
| Quant Midcap Fund | 65% | ₹4,858 crore |
| ITI Midcap Fund | 64.4% | ₹681 crore |
| Mahindra Manulife Midcap Fund | 62.9% | ₹2,074 crore |
| JM Midcap Fund | 60.3% | ₹781 crore |
| WhiteOak Capital Midcap Fund | 60.1% | ₹1,555 crore |
| HDFC Midcap Opportunities Fund | 58.8% | ₹59,027 crore |
| Motilal Oswal Midcap Fund | 58.7% | ₹7,972 crore |
(Source: Value Research)
It's important to note that these returns are based on direct plans as of February 23, and the assets under management figures are as of January 31, 2024.
Investing in mid-cap funds
Midcap funds represent a category of mutual funds that primarily invest in companies with market capitalisations falling between large-cap and small-cap stocks.
These funds focus on companies with a moderate market size, often referred to as mid-sized companies.
Investing in midcap funds offers a balanced approach, as these funds aim to capture the growth potential of smaller companies while maintaining a level of stability associated with larger, more established firms.
They are known for their potential to deliver higher returns compared to large-cap funds, as mid-sized companies often have more room for expansion and growth.
However, it's essential to note that investing in midcap funds comes with increased volatility and risk due to the smaller size and potentially less-established nature of the companies in the portfolio.
Individuals planning to invest in these funds should typically have a higher risk tolerance and a long-term investment horizon, experts say.
(Edited by : Amrita)
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