Best Mid Cap Mutual Funds to invest in India

Best Mid Cap Mutual Funds to Invest in 2022

Mid Cap Mutual Funds are a type of  Equity Mutual funds that invest in Mid Cap companies and other securities like bonds, fixed income assets, etc. Mid Cap companies are categorized as India’s leading 101 to 250 companies as per Market Capitalization.

These 101 to 250 companies will become a stable company in near future and surpass 20000+ crores market capitalization. These companies are kind of stable in business, revenue, profit, and market capital of more than 5000 to 20,000 Crores on average. So, these Mid Cap companies provide a consistent share price (capital gain) return.

Many investors tend to choose Mid Cap Mutual Funds ahead of  small-cap companies, as the results are pretty good with moderate risk. At the same time, indices like Nifty Mid Cap 150 also invest in these companies. It provides a 14-18% nominal return, depending on the performance. Still, if you invest in Mid Cap Mutual funds, then you should at least (minimum) hold your investments for 10-15 years.

Here is the complete list of the 10 best Mid Cap Mutual Funds to invest in India in 2022. We have draft this list post multiple analyses on the following

  • AUM (Asset Under Management)
  • 5 Years Performance.
  • performance from Inception
  • Volatility against Index
  • Expense Ratio
  • Percentage of equity holdings.

Base Criteria behind the 10 best mid cap mutual funds is, AUM should are

  • Minimum 1000 Crores
  • More than 5 years in the market.
  • Direct Plan – Growth Option

What are the Best Mid Cap Mutual Funds in India 2022?

Axis Midcap Fund Direct plan Growth

Axis Midcap Fund-Direct Plan-Growth is one of the top picks from our analysis, as the fund nears 10 years of completion. The fund was started in January 2013, and since its inception, it has yielded a CAGR of  19.86%. The benchmark index for the fund is S&P BSE Midcap TRI

Here are the Stats, why we ranked them as the best mid cap mutual funds to invest in 2022

  • AUM (Asset Under Management – Rs. 16754.33 Crores
  • Expense Ratio – 0.46%
  • 5 Years Performance – 21.12%
  • Performance since Inception – 19.86%
  • Percentage of Equity Holding – 94.9%
  • Risk vs Category – Low

Axis Midcap Fund Direct plan growth is managed by the most experienced fund managers Shreyash Devalkar (since Nov 2016) and Hitesh Das (since Dec 2020). This fund has an asset allocation of Equity (94.9%), Debt (4.7%), and Cash (0.4%).

The equity portfolio consists of various sectors like Financial (19.2%), Technology (17.3%), Chemicals (12.5%), Services (10.7%), Healthcare (7.2%%), Automobile (6.7%), Consumer Durable (6.7%), Construction (5.1%), Others (14.6%).

Here is the Risk Ratio of the Fund (5 Years Analysis):

  • Standard Deviation – 16.79 vs 21.61 (Index)
  • Sharp Ratio – 1.03 vs 0.53 (Index)
  • Alpha – 8.94 vs 7.56 (Index)
  • Beta – 0.73 vs 0.72 (Index)
  • R2 – 89.06 vs 19.95 (Index)

checkout our article for a better understanding of the Risk ratios of a mutual fund.

Other Details of the Fund:

  • P/E – 38.44
  • P/B – 6.45
  • Top 5 Equities hold 18% of AUM
  • Top 20 Equities hold 55% of AUM
  • Exit Load – 1 %if redeemed within 1 year
  • Stamp Duty – 0.005%
  • Minimum SIP – 500

Checkout our article on holistic comparison between Axis Mid Cap Fund vs DSP Mid Cap Fund

Pros
  • 5 and 3 Years Performance is higher than the category average
  • 19.86% returns since Inception
  • Expense Ratio is 0.46%, which is relatively low.
  • Low risk compared to the Category
Cons
  • Last 1 Year returns was low compared to category average

Kotak Emerging Equity - Direct Plan - Growth

Kotak Emerging Equity Fund-Direct Plan-Growth is one of the top picks from our analysis, as the fund nears 10 years of completion. The fund was started in January 2013, and since its inception, it has yielded a CAGR of  20.19%. The benchmark index for the fund is S&P BSE Midcap TRI

Here are the Stats, why we ranked them as the best mid cap mutual funds to invest in 2022

  • AUM (Asset Under Management – Rs. 17756.31 Crores
  • Expense Ratio – 0.53%
  • 5 Years Performance – 16.98%
  • Performance since Inception – 20.19%
  • Percentage of Equity Holding – 96.3%
  • Risk vs Category (5 Years) – Moderately High Risk

Kotak Emerging Equity Fund Direct plan growth is managed by the most experienced fund manager Pankaj Tibrewal (since Jan 2013). This fund has an asset allocation of Equity (96.3%), Cash (3.7%).

The equity portfolio consists of various sectors like Engineering (17.1%), Chemicals (15.1%), Financial (13.2%),  Construction (11.7%), Consumer Durable (8.7%), Healthcare (7.3%), FMCG (6.2%), Others (20.7%).

Here is the Risk Ratio of the Fund (5 Years Analysis):

  • Standard Deviation – 24 vs 21.61 (Index)
  • Sharp Ratio – 0.98 vs 0.53 (Index)
  • Alpha – 6.72 vs 7.56 (Index)
  • Beta – 0.97 vs 0.72 (Index)
  • R2 – 95.82 vs 19.95 (Index)

Other Details of the Fund:

  • P/E – 29.85
  • P/B – 4.38
  • Top 5 Equities hold 20% of AUM
  • Top 20 Equities hold 56% of AUM
  • Exit Load – 1 %if redeemed within 1 year
  • Stamp Duty – 0.005%
  • Minimum SIP – 1000
Pros
  • 5 and 3 years Performance is higher than the category average
  • 20.19% returns since Inception, highest among the category
  • Expense Ratio is 0.53%, which is relatively low.
  • Fund is managed by same manager from the inception.
Cons
  • Last 1 Year returns was low compared to category average
  • 5 Years Risk Analysis is Moderately High

Invesco India Mid Cap Fund- Direct Plan - Growth

Invesco India Mid Cap Fund-Direct Plan-Growth is one of the top picks from our analysis, as the fund has completed 9 years in the market. The fund was started in January 2013, and since its inception, it has yielded a CAGR of  19.98%. The benchmark index for the fund is S&P BSE Midcap TRI

Here are the Stats, why we ranked them as the best mid cap mutual funds to invest in 2022

  • AUM (Asset Under Management – Rs. 2307 Crores
  • Expense Ratio – 0.62%
  • 5 Years Performance – 17.46%
  • Performance since Inception – 19.98%
  • Percentage of Equity Holding – 97.3%
  • Risk vs Category (5 Years) – Moderately Low Risk

Invesco India Mid Cap Fund Direct plan growth is managed by the most experienced fund managers Pranav Gokhale (since Mar 2018), and Neelesh Dhamnaskar (since Jan 2013). This fund has an asset allocation of Equity (97.3%), Cash (2.7%).

The equity portfolio consists of various sectors like Automobile (17.5%), Financial (13.2%), Technology (8.6%), Healthcare (7.4%), Energy (6.9%),  Chemicals (6%), Consumer Durable (5.7%), Others (13%).

Here is the Risk Ratio of the Fund (5 Years Analysis):

  • Standard Deviation – 19.49 vs 21.61 (Index)
  • Sharp Ratio – 0.78 vs 0.53 (Index)
  • Alpha – 5.36 vs 7.56 (Index)
  • Beta – 0.87 vs 0.72 (Index)
  • R2 – 93.80 vs 19.95 (Index)

Other Details of the Fund:

  • P/E – 29.5
  • P/B – 3.89
  • Top 5 Equities hold 17% of AUM
  • Top 20 Equities hold 52% of AUM
  • Exit Load – 1 %if redeemed within 1 year
  • Stamp Duty – 0.005%
  • Minimum SIP – 500
Pros
  • 5 and 3 years Performance is higher than the category average
  • 19.98% returns since Inception, highest among the category
  • Expense Ratio is 0.62%, which is relatively low.
  • 5 years Risk Profile is Moderately Low
Cons
  • Last 1 Year returns was low compared to category average

Nippon India Growth Fund- Direct Plan - Growth

Nippon India Growth Fund-Direct Plan-Growth is one of the top picks from our analysis, as the fund has completed 9 years in the market. The fund was started in January 2013, and since its inception, it has yielded a CAGR of  16.58%. The benchmark index for the fund is S&P BSE Midcap TRI

Here are the Stats, why we ranked them as the best mid cap mutual funds to invest in 2022

  • AUM (Asset Under Management – Rs. 12045 Crores
  • Expense Ratio – 1.21%
  • 5 Years Performance – 16.56%
  • Performance since Inception – 16.58%
  • Percentage of Equity Holding – 97%
  • Risk vs Category (5 Years) – Moderately High Risk

Nippon India Growth Fund Direct plan growth is managed by the most experienced fund managers Manish Gunwani (since Sep 2017), Dhrumil Shah (Since Feb 2019), and Tejas Sheth (since May 2019). This fund has an asset allocation of Equity (97%), Cash (3%).

The equity portfolio consists of various sectors like Financial (23.9%), Services (11.9%), FMCG (9.6%), Construction (7.2%),  Engineering (7%), Technology(6.9%),  Automobile (6.5%), Chemicals (5.5%), Others (16.2%).

Here is the Risk Ratio of the Fund (5 Years Analysis):

  • Standard Deviation – 21.4 vs 21.61 (Index)
  • Sharp Ratio – 0.6 vs 0.53 (Index)
  • Alpha – 3.83 vs 7.56 (Index)
  • Beta – 0.96 vs 0.72 (Index)
  • R2 – 94.37 vs 19.95 (Index)

Other Details of the Fund:

  • P/E – 28.15
  • P/B – 3.74
  • Top 5 Equities hold 17% of AUM
  • Top 20 Equities hold 47% of AUM
  • Exit Load – 1 %if redeemed within 1 year
  • Stamp Duty – 0.005%
  • Minimum SIP – Rs. 100
Pros
  • 5 and 3 years Performance is higher than the category average
  • 16.58% returns since Inception, higher than the category average
  • You can Start investing from Rs. 100 via SIP
Cons
  • Last 1 Year returns was low compared to category average
  • 5 Year risk analysis is Moderately high
  • Expense ratio is 1.21%, which is comparetively high in the category

UTI Mid Cap Fund- Direct Plan - Growth

UTI Mid Cap Fund-Direct Plan-Growth is one of the top picks from our analysis, as the fund has completed 9 years in the market. The fund was started in January 2013, and since its inception, it has yielded a CAGR of  19.74%. The benchmark index for the fund is S&P BSE Midcap TRI

Here are the Stats, why we ranked them as the best mid cap mutual funds to invest in 2022

  • AUM (Asset Under Management – Rs. 6778.92 Crores
  • Expense Ratio – 0.96%
  • 5 Years Performance – 15.08%
  • Performance since Inception – 19.74%
  • Percentage of Equity Holding – 98.4%
  • Risk vs Category (5 Years) – Moderate Risk

UTI Mid Cap Fund Direct plan growth is managed by the most experienced fund manager Ankit Agarwal (since Aug 2019). This fund has an asset allocation of Equity (98.4%), Cash (1.6%).

The equity portfolio consists of various sectors like Financial (15.5%), Automobile (11.2%), Healthcare (10.5%), Technology (8.5%),  Construction (8.2%), Chemicals (7.8%),  Capital Goods (7.4%), Consumer Discretionary (7%), Services (5.6%), Others (18.3%).

Here is the Risk Ratio of the Fund (5 Years Analysis):

  • Standard Deviation – 20.98 vs 21.7 (Index)
  • Sharp Ratio – 0.54 vs 0.43 (Index)
  • Alpha – 2.57 vs 5.55 (Index)
  • Beta – 0.93 vs 0.73 (Index)
  • R2 – 93.14 vs 20.66 (Index)

Other Details of the Fund:

  • P/E – 35.74
  • P/B – 4.85
  • Top 5 Equities hold 15% of AUM
  • Top 20 Equities hold 46% of AUM
  • Exit Load – 1 %if redeemed within 1 year
  • Stamp Duty – 0.005%
  • Minimum SIP – Rs. 500
Pros
  • 5 and 3 years Performance is higher than the category average
  • 19.74% returns since Inception, higher than the category average
  • 5 Year risk analysis is Moderate
Cons
  • Last 1 Year returns was low compared to category average
  • Expense ratio is 0.96%, which is comparatively high in the category

Edelweiss Mid Cap Fund- Direct Plan - Growth

Edelweiss Mid Cap Fund-Direct Plan-Growth is one of the top picks from our analysis, as the fund has completed 5 years in the market. The fund was started in November 2016, and since its inception, it has yielded a CAGR of  20.91%. The benchmark index for the fund is S&P BSE Midcap TRI

Here are the Stats, why we ranked them as the best mid cap mutual funds to invest in 2022

  • AUM (Asset Under Management – Rs. 1862.56 Crores
  • Expense Ratio – 0.51%
  • 5 Years Performance – 18.21%
  • Performance since Inception – 20.91%
  • Percentage of Equity Holding – 96.9%
  • Risk vs Category (5 Years) – Moderately High Risk

Edelweiss Mid Cap Fund Direct plan growth is managed by the most experienced fund managers Sahil Shah (Since Jan 2022) and Trideep Bhattacharya (Since Oct 2021). This fund has an asset allocation of Equity (96.9%), Cash (3.1%).

The equity portfolio consists of various sectors like Financial (18.7%), Engineering (13.5%), Automobile (10.8%), Healthcare (9.4%),  Chemicals (9%), Technology (7.7%),  Construction (7.5%), Energy (5.7%), Services (5.3%), Others (12.4%).

Here is the Risk Ratio of the Fund (5 Years Analysis):

  • Standard Deviation – 21.52 vs 21.7 (Index)
  • Sharp Ratio – 0.96 vs 0.43 (Index)
  • Alpha – 5.15vs 5.55 (Index)
  • Beta – 0.96 vs 0.73 (Index)
  • R2 – 93.74 vs 20.66 (Index)

Other Details of the Fund:

  • P/E – 27
  • P/B – 3.49
  • Top 5 Equities hold 18% of AUM
  • Top 20 Equities hold 57% of AUM
  • Exit Load – 1 %if redeemed within 1 year
  • Stamp Duty – 0.005%
  • Minimum SIP – Rs. 500
Pros
  • 5 and 3 years Performance is higher than the category average
  • 20.91% returns since Inception, higher than the category average.
  • Expense ratio is 0.51%, which is comparatively low than the category average
Cons
  • Last 1 Year returns was low compared to category average
  • 5 Year risk analysis is Moderately High

HDFC Mid Cap Opportunities Fund- Direct Plan - Growth

HDFC Mid Cap Opportunities Fund-Direct Plan-Growth is one of the top picks from our analysis, as the fund has completed 9 years in the market. The fund was started in January 2013, and since its inception, it has yielded a CAGR of  19.11%. The benchmark index for the fund is S&P BSE Midcap TRI

Here are the Stats, why we ranked them as the best mid cap mutual funds to invest in 2022

  • AUM (Asset Under Management – Rs. 31758.62 Crores
  • Expense Ratio – 0.99%
  • 5 Years Performance – 13.85%
  • Performance since Inception – 19.11%
  • Percentage of Equity Holding – 95.2%
  • Risk vs Category (5 Years) – Moderately High Risk

HDFC Mid Cap Fund Direct plan growth is managed by the most experienced fund managers Chirag Setalvad (Since Jan 2013) and Sankalpbaid (Since Jan 2021). This fund has an asset allocation of Equity (95.2%), Cash (4.8%).

The equity portfolio consists of various sectors like Financial (20.7%), Engineering (16.9%), Chemicals (11.4%), Healthcare (9.2%),  Automobile (8.8%), Services (6.8%),  FMCG (5.8%), Others (20.4%).

Here is the Risk Ratio of the Fund (5 Years Analysis):

  • Standard Deviation – 21.52 vs 21.7 (Index)
  • Sharp Ratio – 0.49 vs 0.43 (Index)
  • Alpha – 1.41 vs 5.55 (Index)
  • Beta – 0.97 vs 0.73 (Index)
  • R2 – 96.02 vs 20.66 (Index)

Other Details of the Fund:

  • P/E – 22.7
  • P/B – 2.90
  • Top 5 Equities hold 21% of AUM
  • Top 20 Equities hold 56% of AUM
  • Exit Load – 1 %if redeemed within 1 year
  • Stamp Duty – 0.005%
  • Minimum SIP – Rs. 300
Pros
  • 3 years performance is higher than the category average
  • 19.11% returns since Inception, higher than the category average.
  • You can invest with Rs. 300 per month via SIP
  • Same fund manager is managing since inception
Cons
  • Last 1, and 5 Year returns was low compared to category average
  • 5 Year risk analysis is Moderately High
  • Expense ratio is 0.99%, which is comparatively high than the category average

PGIM India Mid Cap Opportunities Fund- Direct Plan - Growth

PGIM India Mid Cap Opportunities Fund-Direct Plan-Growth is one of the top picks from our analysis, as the fund has completed 9 years in the market. The fund was started in December 2013, and since its inception, it has yielded a CAGR of  20.03%. The benchmark index for the fund is S&P BSE Midcap TRI

Here are the Stats, why we ranked them as the best mid cap mutual funds to invest in 2022

  • AUM (Asset Under Management – Rs. 4363.77 Crores
  • Expense Ratio – 0.42%
  • 5 Years Performance – 20.72%
  • Performance since Inception – 20.03%
  • Percentage of Equity Holding – 94.5%
  • Risk vs Category (5 Years) – Moderately High Risk

PGIM India Mid Cap Fund Direct plan growth is managed by the most experienced fund managers Aniruddha Naha (Since Apr 2018), Kunal Jain (Since Dec 2021), and Vivek Sharma (Since Jun 2021). This fund has an asset allocation of Equity (94.5%), Debt (6.5%), Cash (-1%)

The equity portfolio consists of various sectors like Financial (15%), Construction (13.2%), Healthcare (13.1%),  Engineering (12.8%), Technology (10%), Automobile (9.8%), Chemicals (9.1%), Services (5.5%), and Others (11.6%).

Here is the Risk Ratio of the Fund (5 Years Analysis):

  • Standard Deviation – 24.96 vs 21.7 (Index)
  • Sharp Ratio – 1.22 vs 0.43 (Index)
  • Alpha – 14.5 vs 5.55 (Index)
  • Beta – 0.98 vs 0.73 (Index)
  • R2 – 91.39 vs 20.66 (Index)

Other Details of the Fund:

  • P/E – 31.22
  • P/B – 4.07
  • Top 5 Equities hold 18% of AUM
  • Top 20 Equities hold 57% of AUM
  • Exit Load – 1 %if redeemed within 1 year
  • Stamp Duty – 0.005%
  • Minimum SIP – Rs. 1000
Pros
  • 5 and 3 years performance is higher than the category average
  • 20.03% returns since Inception, higher than the category average.
  • Expense ratio is 0.42%, which is comparatively lowest in the category average
Cons
  • Last 1 Year returns was low compared to category average
  • 5 Year risk analysis is Moderately High

DSP Midcap Fund- Direct Plan - Growth

DSP Mid Cap Fund-Direct Plan-Growth is one of the top picks from our analysis, as the fund has completed 9 years in the market. The fund was started in December 2013, and since its inception, it has yielded a CAGR of  17.58%. The benchmark index for the fund is S&P BSE Midcap TRI

Here are the Stats, why we ranked them as the best mid cap mutual funds to invest in 2022

  • AUM (Asset Under Management – Rs. 14222.72 Crores
  • Expense Ratio – 0.8%
  • 5 Years Performance – 13.54%
  • Performance since Inception – 17.58%
  • Percentage of Equity Holding – 95.5%
  • Risk vs Category (5 Years) – Moderately Low Risk

DSP Mid Cap Fund Direct plan growth is managed by the most experienced fund managers Vinit Sambre (Since Jan 2013), Jay Kothari (Since May 2018), and Resham Jain (Since Mar 2018). This fund has an asset allocation of Equity (95.5%), Cash (4.5%)

The equity portfolio consists of various sectors like Financial (21.3%), Chemicals (18%), Consumer Durable (8.9%),  Healthcare (8.3%), FMCG (7.7%), Automobile (6.8%), Constructions (6.3%), Services (5.9%), Engineering (5.2%), and Others (11.7%).

Here is the Risk Ratio of the Fund (5 Years Analysis):

  • Standard Deviation – 19.21 vs 21.7 (Index)
  • Sharp Ratio – 0.5 vs 0.43 (Index)
  • Alpha – 1.7 vs 5.55 (Index)
  • Beta – 0.85 vs 0.73 (Index)
  • R2 – 91.92 vs 20.66 (Index)

Other Details of the Fund:

  • P/E – 25.79
  • P/B – 4.35
  • Top 5 Equities hold 19% of AUM
  • Top 20 Equities hold 58% of AUM
  • Exit Load – 1 %if redeemed within 1 year
  • Stamp Duty – 0.005%
  • Minimum SIP – Rs. 500
Pros
  • 3 years performance is higher than the category average
  • 17.58% returns since Inception, higher than the category average.
  • 5 Year risk analysis is Moderately Low
  • Expense ratio is 0.8%, which is comparatively lower than the category average
Cons
  • Last 1, and 5 Years returns was low compared to category average.

SBI Magnum Midcap Fund- Direct Plan - Growth

SBI Magnum Mid Cap Fund-Direct Plan-Growth is one of the top picks from our analysis, as the fund has completed 9 years in the market. The fund was started in December 2013, and since its inception, it has yielded a CAGR of  19.55%. The benchmark index for the fund is S&P BSE Midcap TRI

Here are the Stats, why we ranked them as the best mid cap mutual funds to invest in 2022

  • AUM (Asset Under Management – Rs. 6859.18 Crores
  • Expense Ratio – 1.03%
  • 5 Years Performance – 14.29%
  • Performance since Inception – 19.55%
  • Percentage of Equity Holding – 95.5%
  • Risk vs Category (5 Years) – Moderately High Risk

SBI Magnum Mid Cap Fund Direct plan growth is managed by the most experienced fund manager Sohini Andani (Since Jan 2013). This fund has an asset allocation of Equity (95.5%), Cash (4.5%)

The equity portfolio consists of various sectors like Automobile (15.3%), Construction (13.3%), Engineering (12%),  Financial (11%), Consumer Durable (8%), Healthcare (7.7%), Textiles (7.1%), Chemicals (6.5%), Services (5.7%), Metals (5.1%), and Others (8.3%).

Here is the Risk Ratio of the Fund (5 Years Analysis):

  • Standard Deviation – 22.13 vs 21.7 (Index)
  • Sharp Ratio – 0.5 vs 0.43 (Index)
  • Alpha – 1.86 vs 5.55 (Index)
  • Beta – 0.98 vs 0.73 (Index)
  • R2 – 91.79 vs 20.66 (Index)

Other Details of the Fund:

  • P/E – 29.61
  • P/B – 3.86
  • Top 5 Equities hold 24% of AUM
  • Top 20 Equities hold 61% of AUM
  • Exit Load – 1 %if redeemed within 1 year
  • Stamp Duty – 0.005%
  • Minimum SIP – Rs. 500
Pros
  • 5 and 3 years performance is higher than the category average
  • 19.55% returns since Inception, higher than the category average.
Cons
  • Last 1 Year returns was low compared to category average.
  • Expense ratio is 1.03%, which is comparatively higher than the category average.
  • 5 Year risk analysis is Moderately High

Who Should Invest in Large Cap Mutual Funds?

As the investments are made over the upcoming top and stable companies of India, that are being in industry for years. Majority of these companies produce a standard rate of return in terms of revenue, profit, dividend to shareholders. So, investing in these companies produce a stable, moderate risk with huge return to investors in long term.

Mid Cap mutual funds are suitable for investors who aspire to invest in the equity market with relatively moderate to high risk, yet to get high reward. As you have seen the 10 best mid cap mutual funds in India, the risk is between low to moderate in more than 25% of the funds. 50% of funds have risk between moderate to moderately high. Finally, 25% of funds hold high risk.

At the same time, the average 10 years return as per CAGR is around 18-20%. Let us assume, that you invest Rs. 10,000 as SIP (systematic investment plan) in any of the above mutual funds. The return after 10 years will be 33.62 lakhs, and the wealth gain is 21.62 lakhs. This can’t be possible by fixed deposits, endowment policies or postal saving schemes.

In fact, the above 10 funds analysis would have made you understand, even the worst performance, high-risk mutual funds have produced 13%-15% CAGR in the last 10 years.

The only thing, you should keep in mind is to be  long term investor. Don’t care about market price fluctuations, market news, and keep investing via SIP (Systematic Investment Plan). If you can do this consistently with patients, Mid cap mutual fund should be a piece of your asset allocation.

Risk Involved in Mid Cap Mutual Funds?

Even though the risk involved in Mid Cap funds is Moderate to Moderately High, there is risk in the investments. Let’s brief in detail.

1. Equity Market Risk:

Stock markets are always prone to risk, fluctuation, bear, and Bull at any time. I mentioned Bull at last because, even after the market plunges to 30-50%, it rises more substantially like a bull to 100%.

2. Concentration Risk:

When a fund manager parks significant funds in a particular sector, you can make your investments at rest at any time. Few mid cap mutual funds concentrate on one or two industries. When these two sectors plunge continuously, this risks the investors, and the fund may face a considerable sell-off.

3. Liquidity Risk:

There is no liquidity pressure in Mutual Funds, as you can redeem the funds as per your need. The amount will be transferred to your account within 2 working days.

When there is no buyer for the current market price for stocks in your portfolio, automatically, the price has to come down for liquidity. Every Mutual fund holds 1-5% of the total AUM as cash, and it is was paid to you during redemption.

When more investors redeem, this cash holding will exhaust, and the fund manager has to sell the securities to pay you. This is why we suggest investing in mutual funds holding an AUM of more than 1000 crores.

4. Interest rate Risk:

Interest rates fluctuate depending on whether or not issuers have access to credit and whether or not there is demand in the market. Therefore, an increase in the interest rate may adversely affect the security’s price.

5. Credit Risk:

When the security issuer does not pay interest or return the principal at maturity, it creates a credit risk. Few mid cap funds like Axis Mid Cap Mutual Funds hold some percentage of bonds or debt materials, this fund can be prone to credit risk.

Investing in Mid cap mutual funds: What should an investor consider?

1. Investment Objective:

Investment Goal is the primary focus of every mid cap mutual fund while it launches and promotes. First, you should be clear on the benchmark index that your fund is competing. An investor must know the proportion of investment on securities and portfolio of equities. This fundamental analysis provides you few lights on the expected performance of the fund.

2. History of the Fund:

One thing you should know is the history. When the fund opened, what is the performance to date from inception? Peeking at 1 year or 3 years performance is the not way to look at history of fund. Besides NFO, always check the funds that have completed 5 years in the market and yield more than the benchmark index.

3. Fund Manager’s Past Experience:

Fund Managers are the ones who are going to decide the performance the fund you invest. So, it’s necessary to have a quick at the fund managers history.

What are the mutual funds they managed? How long there are managing the current fund? What is the performance vs category of all the fund they managed?.

These analysis will sure provide an exhibit hope on them. It is an advantage if a fund manager is managing the fund you choose since inception.

4. Expense Ratio:

As per the above listing on best large cap mutual funds in India, you can find the funds with lower expense ratio have perform better. So, it’s your duty on choosing the funds with low or moderately low expense ratio (especially when it comes to mid cap funds)

5. AUM (Asset Under Management):

One of the important factor, which many investor forgets to look at. When AUM is higher than 1000 Crores, the liquidity or NAV price risks comes down. Be wise in picking the funds with higher AUM.

6. Direct or Regular Plan:

It has seen from the history that, Direct plan outperform Regular funds. On investors stand point, the major difference between direct and regular fund is the expense ratio. You would seen, the 10 best mid cap mutual funds we have choose are direct plan.

We have listed few choosing factors, but you should know the complete checklists on how to choose a mutual fund in India.

Advantages of Large Cap Mutual Funds:

  • The most significant advantage of investing in mid cap funds is they provide a High returns with moderate risk.
  • These companies have a solid track record in financial revenue flow and pay regular dividends to their shareholders. Also, compete to hold low debt to equity ratio.
  • Best Mid Cap Mutual Funds have moderate to moderately high risk and are nullified if the investment is made for 15 to 20 years.
  • Return on investment ranges between 18% to 20%, higher than fixed deposits, Life Insurance Endowment policies, and other saving schemes.
  • Diversification of investment over the leading, and upcoming Top companies of India.
  • High Liquidity is another advantage.

Disadvantages of Large Cap Mutual Funds:

  • The returns are not as considerably high as Small cap mutual funds
  • The risk profile is now low or moderate compared to large cap mutual funds.
  • Investments can be at risk if prior analyze are not done.
  • We have only 9 years of data for the best Mid cap mutual funds in India.
  • Decision on portfolio management is only with fund managers.
Frequently Asked Questions (FAQ)
What are the best Mid Cap Mutual Fund to Invest in 2022?

The Best Mid Cap Mutual Funds to invest in 2022 are Axis Mid Cap Fund, Kotak Emerging Equity Fund, Invesco India Mid Cap Fund,  Nippon India Growth Fund, UTI Midcap Fund, Edelweiss Midcap funs, HDFC Mid Cap Funds, PGIM India Mid Cap fund, DSP Mid cap Funds, SBI Magnum Midcap Fund. All the above funds are Direct plans.

These best mid cap funds are picked on the basis of Performance from inception, performance for the last 5 years, Expense ratio, AUM, and risk compared to the benchmark.

We have excluded any fund that doesn’t completed 5 years in the market, and AUM under 1000 crores despite of their performance.

Where do Large Cap Mutual Funds Invest?

Mid Cap mutual funds invest in the top 101-250 companies of India. The top 101-250 companies are chosen based on the market capitalization of more than 5000 crores and less than 20,000 crores. As these companies are well-established and stable, the investment returns will also be durable.

Which Mid Cap Mutual Funds is Given the Highest Return?

From the list of the best mid cap mutual funds, we picked the top 3 funds on returns from inception. In this case, the mutual funds with the highest returns are Edelweiss Mid Cap Direct growth fund, Kotak Emerging Equity Direct Growth Fund, and  PGIM India Mid Cap Direct Growth Fund

Is it Good to Invest in Mid Cap Mutual Funds?

The simple answer is “Yes”. Here is the reason why Mid Cap Mutual Funds are good to invest in 2022.

  • These funds are stable,
  • Moderate to moderately high risk
  • Return more than debt funds, fixed deposits, endowment policies, saving schemes, etc.
  • Investment over top 101-250 companies of India.
  • Diversification of companies and sector
  • Professionally managed investment firm
Are Mid Cap Mutual Funds high risk?

On average, only a few funds among the Mid cap mutual funds are mapped under high risk. Unfortunately, they are missing in our 10 best mid cap mutual funds list.  Major midcap funds have risk meters ranging from moderate to moderately high. Even, these risk meters can be nullified if you invest for long term.

What Kind of Returns can I earn from Mid Cap Funds?

The returns from Mid Cap mutual Funds are 3-4x times higher than the inflation of India. Here is the average return from the top 10 large cap mutual funds is 16-18% (average) for the last 5 years, and 18-19% (average) for the last 9 years.

Should I Invest in Mid Cap Mutual Funds

Yes, mid Cap funds should be a slice of your asset allocation. Investing in Mid cap funds provide you stable returns, with moderate risk compared to other equity mutual funds. But, it is purely on basis of your investment goal, and risk appetite.

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