Best mutual funds in India (mid cap and small cap segment) to invest in Jan-2013

Best mid cap and small cap mutual funds in India to invest in Jan-2013

Overview – Best mutual funds in India (mid cap and small cap segment) to invest in Jan-2013

We have been discussing about large cap mutual funds and diversified mutual funds for some time. However to gain more returns we can look at investing in mid cap and small cap mutual funds. There are several good mutual funds in india under mid cap and small cap segment to invest in 2013.

What are mid cap and small cap mutual funds?

As per Crisil, mid cap and small cap mutual funds are those who invest < 45% of their portfolio in large cap stocks defined by Crisil. It means they invest balance of up to 55% in mid cap and small cap stocks along with investments in debt instruments.

Mid cap and small cap mutual funds, are they not risky?

You might be aware that investment in mid cap and small cap stocks are very risky. They are called as high-risk high-return investments. However there is difference between investing in mid cap / small cap stocks Vs investing in mid cap / small cap mutual funds. You may invest in say 5 stocks of such and if few of them underperform, your investment returns would get screwed. However each mutual fund would invest in variety of mid cap and small cap stocks, hence the downside would be less comparing to direct stock investment.

In the booming market, good mutual funds under this segment would out-perform and would provide good returns.

Who can invest in this mid cap and small cap mutual funds?

Investors who have high risk appetite and willing to invest for medium term of 3 to 5 years can invest in such mutual funds. I would not advice any one to invest in such mutual funds for long term of 5+ years as the mid cap and small cap stocks may or may nor outperform in the long run which would affect this mutual fund segment.

Large cap mutual funds Vs mid cap and small cap mutual funds

Large cap mutual funds invest majority of their portion in large cap stocks. The downside of the investment is limited. However for mid cap and small cap mutual funds, the downside is on the higher side comparing to largcap mutual funds. The returns also would be high in mid cap / small cap mutual funds. In the booming market, mid cap and small cap mutual funds would outperform the large cap segment.

Best mutual funds in India (mid cap and small cap segment) to invest in 2013

Best mid cap and small cap mutual funds in India to invest in Jan-2013

Conclusion: There are several mutual funds to invest in. Mid cap and small cap mutual funds falls under high risk and high return investments. Investors, who have high risk appetite, looking for high returns in medium term period can invest in these best mutual funds in India. 

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Suresh
Best mutual funds in India (mid cap and small cap segment) to invest in Jan-2013

6 comments

  • vikas

    Hello Sir i am new to this but i want to invest 1000 each every monthly in 3 to 4 mid cap companies kindly give me good advice my age is 48years

  • Raghav

    Hello Suresh,

    My current age is 29 and married. I am new to SIP and recently I started SIP and i have selected below funds and i want to stay invested for long term (>10 years) to yield good returns to achieve long term financial goals. Please advice on the funds selected and when should i increase the SIP amount and how often should i review my portfolio.

    Quantum LT Equity Fund(G)  – 1000/month

    HDFC Mid-Cap Opportunities Fund(G) – 1000/month

    HDFC Balanced Fund(G) — 1000/month

    ICICI Pru Top 100 Fund-Reg(G) – 1000/month

    Birla SL Top 100 Fund(G) — 1000/month

    I am investing on different dates for each fund.

    Thanks and Best Regards,

    Raghavendra P

  • Vikas

    Hello Sir,
    I’m 28 year old & I can take risk. I’m investing in icici pru focused blue chip & icici pru value discovery through SIP from last 1 year. My investment horizon is 15 years. Is it right funds selection? Thanks.

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