If you are a mutual fund investor with a higher risk appetite then the chances are that you have invested a chunk of your portfolio in the mid-cap mutual funds.
The year 2023 that has just culminated has delivered a considerably high return across sectors and market capitalisations. BSE Sensex gave over 18 percent return while Nifty50 settled 20 percent higher.
Amid the ongoing bull run, mid cap mutual funds have surpassed investors’ expectations by delivering the returns in the range of 38-48 percent in 2023.
Mid cap mutual funds
For the unversed, mid cap mutual funds refer to the schemes that invest a minimum of 65 percent of their assets in mid-cap stocks i.e., the securities of companies ranked between 101 to 250 on stock markets as per market capitalisation.
Investing in mid cap mutual funds (along with small caps) is recommended for investors who have a high-risk appetite. Although these schemes offer a high return, they exhibit a higher volatility of prices at the same time.
This means when the market index rises, these schemes jump even higher and when the market falls, they slide even steeper.
The top performing mid cap mutual funds are as follows:
| Mid cap funds | 1-year-return (%) |
| Nippon India Growth Fund | 48.61 |
| Mahindra Manulife Mid Cap Fund | 47.01 |
| JM Midcap Fund | 44.54 |
| HDFC Mid-Cap Opportunities Fund | 44.47 |
| WhiteOak Capital Mid Cap Fund | 41.51 |
| Tata Midcap Growth Fund | 40.54 |
| HSBC Midcap Fund | 40.01 |
| Aditya Birla Sun Life Mid Cap Fund | 39.87 |
| DSP Midcap Fund | 38.44 |
| Edelweiss Mid Cap Fund | 38.42 |
(Source: AMFI; 1-year-returns as on Dec 29, 2023)
As we can see in the table above, seven out of the ten schemes have given over 40 percent return in the past one year whereas the remaining three have given returns in the range of 38-39 percent.
The top performing mid-cap mutual funds include Nippon India Growth Fund, Mahindra Manulife Mid Cap Fund, JM Midcap Fund and HDFC Mid-Cap Opportunities Fund (see table above).
It is imperative to mention that the historical returns of equity mutual funds — albeit an important factor — do not guarantee the future potential of a mutual fund scheme. Other key factors on which an investor should weigh their decision of whether to invest or not include the category the mutual fund scheme belongs to, reputation of the fund house and that of the fund manager.
Note: This story is for informational purposes only. Please speak to a SEBI-registered investment advisor before making any investment related decision.
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