A mid cap fund is a good way to go if you do not want too much risk while at the same time being able to get better returns than in a large cap fund. Well established yet growing establishments are the ones that form the mid cap segment for them to be multi asset in investments. In this article, we will further delve into why mid cap mutual funds may be suited for you, find out how a SIP calculator tool can be useful and highlight such funds which will help you fulfil your investment objectives.
Types of People Who Invest in Mid Cap Mutual Funds
Mid cap mutual funds are those funds that invest in companies which are less than blue chip but more than small cap stocks. These companies are often in the growth phase of their business cycle and hence are expected to grow more compared to other large cap stocks. There is a lot of fortune to be made from mid-cap funds if you can bear a little more aggressive strategy as compared to investing in large cap equity funds.
What’s good about mid cap mutual funds is that they are a good way to get diversification. Such funds are not overly concentrated on the performance of one particular stock since they are all invested in mid cap companies. Such diversification achieves an equilibrium between risk and reward, explaining why such funds appeal to investors who are looking for some growth but with an associated moderate risk.
Calculating Investment using SIP
In the mutual fund options, the Systematic Investment Plan also includes mid cap mutual funds, this is because it is very popular. SIP means that you invest a certain sum of money at regular intervals which helps avoid the drastic fluctuations that one would have faced all of sudden investing a lump sum amount into the market.
To gauge how much more you need to invest and what value in returns can be expected, a SIP calculator will come in hand. A SIP calculator is used to find the future value of your investment, based on your monthly payments, the investment period and the level of returns that is expected.
For example, let’s say that you would like to invest a lump sum amount in mid cap mutual funds through an SIP, you can calculate the amount of mutual fund to be bought on a monthly basis in order to achieve those financial goals. This also helps in gaining a better appreciation of the power of compounding and assists in defining achievable investment goals.
Best Mid Cap Mutual Funds To Enhance Your Wealth
In the case where you are trying to choose the best mid cap mutual funds, some of the things you ought to consider are the longevity, historical performance of the funds, the management of the funds and the expense ratio. Here are a few of these mid cap mutual funds that have consistently received accolades boards for their great performance and all the prospects to enhance wealth: HDFC Mid-Cap Opportunities Fund- Has shown growth, it is a particular amongst itself as it has an in-depth and eclectic mix of investments in high-growth companies. It invests in a pool of mid-cap and large-cap equity to seek growth in capital.
ICICI Prudential Midcap Fund: This scheme captures high mid-cap stocks with good scope for growth. It has a long history of helping investors create wealth in the long run and hence provides investors a good option to invest in fast-growing sectors.
Axis Midcap Fund: Axis Midcap Fund is often appreciated for its systemized investment strategy and satisfactory returns. The fund is oriented towards accelerating growth and aims to achieve enhanced returns by investing in a diversified portfolio of mid cap stocks.
UTI Mid Cap Fund: This fund has been one of the leaders in this mid cap category. It invests in a well-researched basket of mid-sized companies and is reputed for its sound investment approach and risk management.
Kotak Emerging Equity Fund: The objective of this fund is to invest in emerging mid cap companies and to provide substantial capital appreciation to its investors. The team is experienced and manages mid cap investments.
There are tips to help out the investors when it has to do with Mid Cap Mutual Funds investments
Evaluate Your Risk Tolerance: Mid cap stocks may be more volatile than large cap stocks. Manage your risk by ensuring that your risk tolerance is right with the expected volatility of mid cap investments.
Diversify Your Investments: Even though mid cap funds present chances for growth it is very wise to have a varying investment portfolio. Make sure that you incorporate some large cap, and small cap and also fixed income investments to reduce risk.
Monitor Fund Performance: Monitor the performance of your mid cap mutual funds and review them on the periodical basis. Evaluate continuously if the fund is able to deliver your targets and if necessary, make reallocation actions.
Use Financial Tools: Use tools such as SIP calculator to strategically assess the investment. It also keeps you focused towards the targets you have for your investments and gives an idea to the investors how much their investments can grow in time.
Consult a Financial Advisor: If you want to know which mid cap mutual funds have a particular focus or the manner in which investments are best structured, it is advisable to get a financial advisor, as they will help you in every step towards attainment of your financial goals.
Conclusion
Mid cap mutual funds can be great weapons to increase returns effectively. However, such a strategy allows achieving a good risk- cost ratio. Thanks to SIP calculators, it is easy to make the right investment decisions and keep on achieving set investment objectives. With the correct approach and selected fund behind you, your investment portfolio has all the chances to be a goldmine with effractively impressive returns to growth. Walk through the above-mentioned funds and see the alignment with your financial plans and make progress in investing without fear of making losses.