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Frequently asked questions
Which is the best mid-cap fund in India 2024?
The choice of the best mid-cap mutual funds for your portfolio depends on your financial goals, risk tolerance, and investment horizon. You can compare the top mid-cap mutual funds and make an informed decision.
Are mid-cap funds suitable for long-term investing?
Yes. Mid-cap mutual funds, like all equity funds, are better suited for long-term investing because they help you ride out short-term market volatility. You can even benefit from compounding if you choose SIPs.
How do I know if mid-cap funds are suitable for me?
Mid-cap funds may be suitable for you if you have a long-term investment horizon, can tolerate high levels of market-linked risk and are a seasoned investor with some market knowledge.
What returns can I expect from mid-cap funds?
The returns from mid-cap funds are market-linked and therefore, vary from one year to the next. Broadly, remaining invested over the long term has historically yielded favourable returns for investors.
Are there any risks involved in investing in mid-cap funds?
Yes, these mutual funds carry some risks like exposure to market volatility, liquidity risks and general market-linked systematic risk. Furthermore, they also carry unsystematic risks based on the companies in the portfolio.
Are returns from mid-cap funds taxable?
Yes, returns from mid-cap mutual funds are taxed the same as the returns from any other equity-oriented funds. Short-term capital gains are taxed at 20%. Long-term capital gains exceeding Rs. 1.25 lakh are taxed at 12.5% without any indexation benefit.
How much of my capital should I allocate to mid-cap funds?
This depends on your investment budget, risk tolerance, financial goals, age, income, other debts and your tax goals.
How long should I remain invested in mid-cap funds?
Your investment horizon should align with the timeline of the financial goals you wish to achieve using the returns from the mid-cap mutual funds.
Generally, long-term investments are advisable.
In what assets do mid-cap funds invest?
These mutual funds invest at least 65% of their capital in mid-cap stocks — which are issued by companies ranked from 101 to 250 in terms of their market capitalisation.
Is mid-cap mutual fund safe?
Mid-cap mutual funds carry a moderate risk level, as they invest in companies with medium market capitalisation. While they offer higher growth potential than large-cap funds, they can also be more volatile. Investors should consider their risk tolerance and investment horizon before opting for mid-cap funds, ideally aiming for a longer-term perspective.
Should I invest in mid-cap mutual funds?
Investing in mid-cap mutual funds can be beneficial if you seek higher growth potential and are willing to tolerate moderate risk. These funds offer a balance between stability and capital appreciation, making them suitable for investors with a long-term investment horizon and a moderate risk appetite. Always align investments with your financial goals.
How to buy mid-cap index mutual fund?
You can buy mid-cap index mutual funds through online platforms, such as the Bajaj Finserv app, or directly via the fund house's website. Simply choose your desired fund, complete the KYC process, and invest through a lump sum or SIP. Consider factors like fund performance, fees, and investment goals before making a decision.
Is it a good time to buy mid-cap mutual funds?
The timing for investing in mid-cap mutual funds depends on market conditions and your financial goals. These funds typically perform well in a growing economy but can be volatile during market downturns. Assess your risk tolerance and investment horizon, and consider market trends before investing to maximise growth potential while managing risks.
