Microcaps top 10-year returns chart, outshine midcaps and smallcaps
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10-year scorecard
Over the last 10 years, microcaps delivered the highest returns, outperforming midcaps, small caps, and large caps. Here is a detailed breakup, as reported by ET Wealth.
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Microcaps
Over the last 10 years, microcaps delivered the highest return of around 22.2%. In the calendar year 2026, the segment generated a return of 8.6%. Strong investor appetite for growth, exposure to niche businesses, and relatively attractive valuations have supported its outperformance.
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Midcaps
Over the last 10 years, midcaps delivered a return of 18.6%. In 2026, the segment returned 1.6%. Analysts note that sectors such as manufacturing, defence, capital goods, energy, and infrastructure have stronger representation within the midcap universe than in large caps. Midcaps' closer linkage to India's domestic growth story has also enabled them to benefit from sustained government capex.
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Smallcaps
Over the last 10 years, smallcaps delivered a return of 15.7%. In 2026, the segment generated a return of 4.4%. Smallcaps have benefited from increased investor participation in quality companies with strong balance sheets and sector leadership. Additionally, lower interest rates and government measures aimed at boosting consumption and economic activity have supported performance.
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Largecaps
Large caps delivered a return of 12.8% over the last 10 years. In 2026, the segment posted a negative return of 7.9%, making it the weakest performer so far this year. A shift in foreign investor flows towards AI-driven markets such as Taiwan and South Korea, along with concerns over rising crude prices and geopolitical tensions, has weighed on sentiment. Heavyweights in banking, IT, and consumption, key constituents of the Nifty 50, have borne the brunt of the sell-off.
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Long-term performance
Over the past decade, the data show that investors willing to tolerate higher volatility have been rewarded with superior returns. While large caps provided relative stability, broader market segments, particularly midcaps and microcaps, captured India's economic transformation more effectively and delivered significantly higher long-term wealth creation.