Investing in mutual funds is a smart way to grow your money over time. With so many options available, finding the right one can be overwhelming. That's where the best midcap mutual funds come into play. These funds invest in mid-sized companies that have the potential to grow significantly. In 2024, midcap mutual funds in India are expected to be especially rewarding due to their balanced approach to growth and risk. They offer a sweet spot for investors, providing a mix of stability and high returns, making them a great choice for long-term investors.
1. Midcap mutual funds offer significant growth potential.
2. They provide diversification benefits with moderate risk.
3. Ideal for investors with a long-term horizon.
Midcap mutual funds invest in mid-sized companies that have a market capitalization ranging from Rs 5,000 crores to Rs 20,000 crores. These companies are typically in a growth phase, offering a blend of stability and potential for high returns. Midcap funds are positioned between large-cap funds, which invest in well-established companies, and small-cap funds, which target emerging firms with higher risk and reward profiles.
Investing in midcap mutual funds can be an excellent way to capitalize on the growth potential of mid-sized companies. These firms often have substantial room to expand and innovate, leading to higher returns for investors. Unlike large-cap funds, which offer more stability but lower growth prospects, midcap funds strike a balance between risk and reward. They are less volatile than small-cap funds, making them a more attractive option for moderate risk-takers.
As we enter 2024, let’s highlight the 10 Top Midcap Mutual Funds to invest in, considering 'fund performance' as a key criterion for selection. Each fund’s unique strategy and asset allocation promises to cater to different investor profiles and financial goals. The chart below is prepared as per the highest 5-year return.
| 10 Best Midcap Mutual Funds (2024) | 5Yr Return |
|---|---|
| 1. Quant Mid Cap Direct Growth | 366.29% |
| 2. Motilal Oswal Midcap Direct Growth | 268.45% |
| 3. Mahindra Manulife Midcap Direct Growth | 253.92% |
| 4. PGIM India Midcap Opps Fund Direct-Growth | 248.46% |
| 5. Edelweiss Mid Cap Direct Growth | 242.26% |
| 6. Nippon India Growth Direct Growth | 233.78% |
| 7. HDFC Mid-Cap Opportunities Direct Growth | 221.89% |
| 8. Kotak Emerging Equity Direct Growth | 221.76% |
| 9. SBI Magnum Midcap Direct Growth | 218.59% |
| 10. Invesco India Midcap Direct Growth | 215.44% |
For several reasons, investing in the best midcap mutual funds is a smart choice. First, midcap companies are in their growth phase, meaning they have significant potential to expand and increase their market share. This growth phase can translate into higher returns for investors compared to large-cap funds, which invest in more established companies with less room for rapid growth. By investing in midcap mutual funds, you can benefit from the success of companies on their way to becoming industry leaders.
Moreover, midcap mutual funds offer a balanced risk-reward profile. While they are riskier than large-cap funds, they are generally less volatile than small-cap funds. This makes them a good option for investors who are willing to take on some risk for the possibility of higher returns but do not want the extreme volatility that comes with small-cap funds. Overall, midcap mutual funds are a great way to diversify your investment portfolio and take advantage of the growth potential of mid-sized companies.
Before investing in midcap mutual funds, evaluating several factors to ensure they align with your investment goals and risk tolerance is important. Here are some key points to consider:
Investing in midcap mutual funds comes with certain risks that you should be aware of before committing your money. Here are some key risks to consider:
Understanding the tax rules for midcap mutual funds can help you plan your investments better. Here are the key tax aspects you need to know:
Equity Linked Savings Schemes (ELSS) are a special type of mutual fund that offer tax benefits. By investing in ELSS, you can deduct up to Rs 1.5 lakh from your taxable income under Section 80C of the Income Tax Act. These funds come with a three-year lock-in period, which is shorter compared to other tax-saving options. ELSS funds mainly invest in stocks, including midcap stocks, giving you both tax savings and the potential for good returns. This makes them a popular choice for investors looking to save on taxes while also growing their money.
Previously, dividends from mutual funds were taxed before reaching investors, known as Dividend Distribution Tax (DDT). Now, dividends are added to your total income and taxed according to your income tax slab. This means if you receive dividends from your midcap mutual funds, you will pay tax on them based on your overall income level.
Here is an overview of the 10 Top Midcap Mutual Funds and their Expense Ratio, NAV, and Returns.
Quant Mid Cap Fund Direct-Growth is one of the best midcap mutual funds introduced by Quant Mutual Fund. Investors were allowed to access this programme on April 15, 1996. Sanjeev Sharma is the current fund manager of the Quant Mid Cap Fund Direct-Growth fund.
Returns:
| 1Y Return (%) | 3Y Return (%) | 5Y Return (%) |
| 73.78 | 144.29 | 366.29 |
Motilal Oswal Mutual Fund introduced the Motilal Oswal Midcap Fund Direct Growth equity mutual fund scheme. Investors were allowed to access this plan on December 29, 2009. The Motilal Oswal Midcap Fund Direct Growth fund's current fund managers are Abhiroop Mukherjee, Akash Singhania, and Siddharth Bothra.
Returns:
| 1Y Return (%) | 3Y Return (%) | 5Y Return (%) |
| 55.72 | 157.19 | 268.45 |
Mahindra Manulife Mid Cap Fund is one of the best Midcap mutual funds introduced by Mahindra Mutual Fund. Investors were allowed to access this plan from February 4, 2016. The current fund manager of the Mahindra Manulife Mid Cap Fund Direct-Growth fund is V Balasubramanian.
Returns:
| 1Y Return (%) | 3Y Return (%) | 5Y Return (%) |
| 60.54 | 113.03 | 253.92 |
PGIM India Mutual Fund introduced the PGIM India Midcap Opportunities Fund Direct Growth equity mutual fund scheme. Investors were allowed to access this plan on May 13, 2010. The current fund manager of the PGIM India Midcap Opportunities Fund Direct Growth fund is Avinash Agarwal, Kumaresh Ramakrishnan.
Returns:
| 1Y Return (%) | 3Y Return (%) | 5Y Return (%) |
| 31.17 | 72.58 | 248.46 |
The Edelweiss Mutual Fund introduced the Edelweiss Mid Cap Direct Plan-Growth, an equity mutual fund scheme. Investors were allowed to access this plan on April 30, 2008. Edelweiss Mid Cap Direct Plan Growth fund's current fund manager is Harshad Patwardhan.
Returns:
| 1Y Return (%) | 3Y Return (%) | 5Y Return (%) |
| 52.72 | 105.23 | 242.26 |
Nippon India Mutual Fund introduced the Nippon India Growth Fund Direct-Growth equity mutual fund scheme; it is one of the best-performing midcaps under its category. Investors were eligible to access this plan on June 30, 1995. The Nippon India Growth Fund Direct Growth fund's current fund manager is Manish Gunwani.
Returns:
| 1Y Return (%) | 3Y Return (%) | 5Y Return (%) |
| 55.82 | 115.77 | 233.78 |
An equity mutual fund scheme called HDFC Mid Cap Opportunities Direct Plan Growth was introduced by HDFC Mutual Fund. Investors were allowed to access this plan on December 10, 1999. Currently serving as the fund manager for the HDFC Mid Cap Opportunities Direct Plan Growth fund is Chirag Setalvad.
Returns:
| 1Y Return (%) | 3Y Return (%) | 5Y Return (%) |
| 52.72 | 114.37 | 221.89 |
Kotak Mahindra Mutual Fund introduced the Kotak Emerging Equity Fund Direct-Growth equity mutual fund scheme. Investors were eligible to access this plan on August 5, 1994. Pankaj Tibrewal is currently serving as the fund manager of the Kotak Emerging Equity Fund Direct-Growth fund.
Returns:
| 1Y Return (%) | 3Y Return (%) | 5Y Return (%) |
| 47.32 | 94.94 | 221.76 |
SBI Mutual Fund introduced the Equity Mutual Fund Scheme SBI Magnum Mid Cap Direct Plan Growth. Investors were eligible to access this programme on June 29, 1987. Currently serving as the SBI Magnum Mid Cap Direct Plan Growth fund's fund manager is Sohini Andani.
Returns:
| 1Y Return (%) | 3Y Return (%) | 5Y Return (%) |
| 37.58 | 94.61 | 218.59 |
An equity mutual fund scheme called Invesco India Mid Cap Fund Direct-Growth was introduced by Invesco Mutual Fund. Investors were allowed to access this plan on July 24, 2006. The current fund manager of the Invesco India Mid Cap Fund Direct-Growth fund is Vinay Paharia.
Returns:
| 1Y Return (%) | 3Y Return (%) | 5Y Return (%) |
| 50.70 | 98.42 | 215.44 |
Ready to invest in a small-cap mutual fund? Here’s how you can get started easily with Lakshmishree.
Investing in midcap mutual funds can be a smart move for those looking to balance growth potential and risk. These funds provide an opportunity to invest in mid-sized companies that are on the path to becoming industry leaders. With their higher growth potential compared to large-cap funds and a more balanced risk profile than small-cap funds, midcap mutual funds can be a valuable addition to your investment portfolio. By understanding key factors like past performance, fund manager expertise, and expense ratios, you can make informed decisions and choose the best midcap mutual funds for your needs.
Some of the best midcap mutual funds for 2024 include Quant Mid Cap, Motilal Oswal Midcap, Mahindra Manulife Midcap, PGIM India Midcap Opps Fund, and Edelweiss Mid Cap as giving a high return in the last 5 years.
Most midcap mutual funds allow investments through SIPs starting from as low as Rs 100, making them accessible to a broad range of investors. Start investing in Mutual with Lakshmishree without paying any annual fee.
The performance of mid-cap funds varies over time. Currently, funds like Quant Mid Cap, ITI Mid Cap, JM Midcap, Mahindra Manulife Midcap and HSBC Midcap are the best performing midcap mutual funds and have shown the highest returns in the last 1year.
However, reviewing the latest performance data and consulting with a financial advisor before making investment decisions is essential.
No, midcap mutual funds are better suited for long-term goals due to their inherent volatility. Short-term investments may not capture the full growth potential of mid-sized companies.
When choosing a midcap mutual fund, consider factors like past performance, expense ratio, and the fund manager's track record. It's also important to align the fund with your investment goals and risk tolerance.
Historically, small-cap and mid-cap funds have shown the potential for higher returns due to their investment in rapidly growing companies, but they also come with higher risk and volatility.
Investments in midcap mutual funds are subject to short-term and long-term capital gains tax. Short-term gains are taxed at 15%, while long-term gains are taxed at 10% for gains exceeding Rs 1 lakh.
Midcap funds focus on mid-sized companies with high growth potential and moderate risk, while flexicap funds invest across all market capitalizations for more diversification. Your choice depends on your investment goals and risk tolerance.
