The superior performance of midcap funds during the last few days has attracted investors. But is it okay to invest in these funds at the present time? Experts say that do not invest in mid-cap funds at one go. Investors should stop and invest a little bit in it.
It says that after beating large-cap funds in 2021, there is scope for investment in midcap funds, but their valuation is not yet cheap. Although they are likely to go up. According to experts, investment in mid-cap products can be done in Axis Mutual, Motilal Oswal Union, and Invesco.
If seven of the large-cap companies have given 5 to 10 times the returns, then 11 mid companies have done so. There are many mid-companies that are leaders in their fields. Hence, there remains a great possibility of investing in midcap mutual funds.
The Nifty Midcap 150 returns 88 percent, while the Nifty benchmark returns 60 percent. From January 2018 to April 2021, the Nifty Midcap 150 has given 6.9 percent returns on an annual basis, while the Nifty has gained 10.7 percent during this period.
Analysts say that in the last few years, the correction in the valuation of the midcap space as compared to the large-cap space has reduced the artificial increase in the returns of the mid-cap fund. Therefore, there is a possibility of investment in them.
Although the valuation of midcap funds is not cheap, due to low interest rates, there is an investment climate in them. If investors want, then gradually they can increase their investment in them. In the last five years, the midcap segment has performed well in the top 500 stocks.
If seven of the large-cap companies have given 5 to 10 times the returns, then 11 mid companies have done so. There are many mid-companies who are leaders in their fields. Hence, there remains a great possibility of investing in midcap mutual funds.
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