- Mid-cap funds offer growth from medium-sized companies; suit long-term investors.
- HDFC, Nippon India mid-cap funds show varied returns over time.
- Funds differ in portfolio, size, and top sector allocation.
Mid cap Mutual Funds have become a popular choice among investors looking for higher long-term growth than large cap funds without taking on the higher risk associated with small cap schemes. These funds invest primarily in medium-sized companies that are in the growth stage of their business journey. These funds are equity schemes that invest at least 65 per cent of their assets in mid cap companies, as defined by the Securities and Exchange Board of India (SEBI). These companies are ranked between 101 and 250 based on their full market capitalisation.
Like any equity investment, mid cap funds can be volatile in the short term. They are generally better suited for investors with a long investment horizon and the ability to withstand market fluctuations. Who should invest in mid cap funds? Mid cap mutual funds may be suitable for investors who: Have an investment horizon of at least five to seven years. Are seeking long-term capital appreciation.
Can tolerate moderate to high market volatility. Want to diversify their equity portfolio beyond large cap funds. Among the most tracked schemes in this category are HDFC Mid Cap Fund and Nippon India Growth Mid Cap Fund. While both have built strong long-term track records, they differ in terms of returns across different periods, portfolio composition and fund size.
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HDFC Mid Cap Fund vs Nippon India Growth Mid Cap Fund Fund overview Particulars HDFC Mid Cap Fund Nippon India Growth Mid Cap Fund Category Equity – Mid Cap Equity – Mid Cap Fund age 19 years 2 months 30 years 10 months Fund size Rs 1,00,858 crore Rs 49,169 crore Return comparison Time period HDFC Mid Cap Fund Nippon India Growth Mid Cap Fund 3 months 6.70 per cent 4.12 per cent 6 months 3.79 per cent 6.77 per cent 1 year 9.46 per cent 10.22 per cent 3 years (annualised) 19.62 per cent 20.91 per cent 5 years (annualised) 19.41 per cent 18.54 per cent
The comparison shows that leadership changes depending on the investment period.
HDFC Mid Cap Fund has delivered stronger returns over the past three months and five years. Nippon India Growth Mid Cap Fund, on the other hand, has outperformed over the six-month, one-year and three-year periods.
Portfolio comparison
Top sector allocation
HDFC Mid Cap Fund Allocation Nippon India Growth Mid Cap Fund Allocation Financial 23.70 per cent Financial 20.74 per cent Healthcare 14.84 per cent Services 19.07 per cent Automobile 8.96 per cent Healthcare 11.67 per cent
Top five holdings
HDFC Mid Cap Fund Weight Nippon India Growth Mid Cap Fund Weight
The Federal Bank Ltd 4.18 per cent
BSE Ltd 2.99 per cent
Max Financial Services Ltd 4.10 per cent
The Federal Bank Ltd 2.75 per cent
AU Small Finance Bank Ltd 4.08 per cent
Fortis Healthcare Ltd 2.66 per cent
Balkrishna Industries Ltd 3.10 per cent
AU Small Finance Bank Ltd 2.65 per cent
Fortis Healthcare Ltd 3.07 per cent
Bharat Forge Ltd 2.37 per cent
Returns are important, but not the only factor Historical returns are one of the first metrics investors look at while comparing mutual funds. However, experts believe they should not be the only factor influencing an investment decision, as past performance does not guarantee future returns.
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Before investing, investors should also evaluate: Risk-adjusted returns. Portfolio diversification and stock concentration. Fund manager’s investment approach and track record. Expense ratio. Portfolio turnover. Consistency across different market cycles. Whether the scheme matches their financial goals and risk appetite. Looking at these factors together provides a more balanced view of a fund’s long-term potential.
(“Disclaimer: This article uses information originally published by Dalal Street Investment Journal (DSIJ). The views expressed are those of the original authors and not necessarily of ABP Network Pvt. Ltd. This content is provided for general informational and educational purposes only and should not be construed as investment, financial, legal or tax advice. Readers are advised to conduct their own research and/or consult a qualified financial advisor before making any investment decisions. This content is for informational purposes only and should not be treated as investment advice. ABP Network, its employees and associates shall not be responsible or liable for any losses or damages arising directly or indirectly from the use of or reliance on this article or any information contained herein.”)
