Mid-Cap Funds: An opportunity to invest in uncertain market behaviour
Midcap companies are in a stage of rapid growth and this high growth rate can give one excellent returns on investments.
By ET Online |
MUMBAI: Big investors like mutual funds and Foreign Institutional Investors are increasingly investing in mid caps nowadays because midcaps companies have the potential to become future heavy weights entities and the stocks of these companies are affordable to invest. Thus, investors in midcaps stand to benefit from their investment in this segment.
Midcap companies are in a stage of rapid growth and this high growth rate can give one excellent returns on investments. Such companies offer higher growth potential going forward and therefore an opportunity to benefit from higher than average valuations. Mid cap companies are looked upon as wealth creators and have the potential to join the league of large cap companies. Such companies are nimble, flexible and can adapt to the changes faster. One of the challenges that fund managers of mid cap funds face is to identifying such companies particularly in a situation when the price of large caps has increased substantially.
Infact as a testimony to the potential that midcap stocks holds, in the past three year, CNX mid-cap index has outperformed the benchmark equity index, Sensex.
Birla Sun Life Midcap Fund has bettered benchmark CNX Midcap over one, three and five-year periods. Over a five-year period, it has delivered a compounded annual return of 29.5 per cent, placing it among the top few funds in the mid-cap category, as on 31st August 2009. During the same period CNX Midcap has delivered 22.5% return.
Birla Sun Life Midcap Fund is an open ended growth fund which focuses on investing in the Midcap segment of the market. The fund aims to maximize gains through investments in stocks with excellent growth potential.
Midcap companies are in a stage of rapid growth and this high growth rate can give one excellent returns on investments. Such companies offer higher growth potential going forward and therefore an opportunity to benefit from higher than average valuations. Mid cap companies are looked upon as wealth creators and have the potential to join the league of large cap companies. Such companies are nimble, flexible and can adapt to the changes faster. One of the challenges that fund managers of mid cap funds face is to identifying such companies particularly in a situation when the price of large caps has increased substantially.
Infact as a testimony to the potential that midcap stocks holds, in the past three year, CNX mid-cap index has outperformed the benchmark equity index, Sensex.
Birla Sun Life Midcap Fund has bettered benchmark CNX Midcap over one, three and five-year periods. Over a five-year period, it has delivered a compounded annual return of 29.5 per cent, placing it among the top few funds in the mid-cap category, as on 31st August 2009. During the same period CNX Midcap has delivered 22.5% return.
Birla Sun Life Midcap Fund is an open ended growth fund which focuses on investing in the Midcap segment of the market. The fund aims to maximize gains through investments in stocks with excellent growth potential.
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