Best Large & Mid Cap Funds
About Large & Mid Cap Mutual Funds
Large & mid-cap mutual funds invest in a mix of large-cap and mid-cap companies. Large-cap companies are the largest companies in the market by market capitalisation, while mid-cap companies are relatively smaller but still established companies.
Large and mid cap mutual funds offer investors the potential to earn higher returns than large-cap funds alone, but they also come with more risk. Mid-cap companies are more volatile and can be more susceptible to economic downturns. However, they also have the potential to grow faster than large-cap companies over the long term.
Large & mid cap mutual funds aim to combine the strengths of both large-cap and mid-cap stocks. By investing in a mix of these stocks, these funds provide investors with diversification across companies of different sizes.
How Do Large & Mid Cap Funds Work?
Large and mid-cap funds typically allocate their assets between large and mid-cap companies based on a specific investment strategy. Some funds may invest more heavily in large-cap companies, while others may invest more heavily in mid-cap companies. However, these funds spread their funds across the said market caps to provide investors with exposure to a diversified portfolio, which can help reduce risk and optimise returns over the long term.
Features of Large & Mid Cap Mutual Funds
- Potential for competitive returns: By investing in companies of varying sizes, Large and Mid Cap funds have the potential to offer competitive returns over the long term, making them suitable for investors with a medium-term investment horizon.
- Risk and return: Large and mid-cap mutual funds offer the potential to earn higher returns than large-cap funds alone, but they also come with more risk. Mid-cap companies are more volatile and can be more susceptible to economic downturns.
- Transparency: Large and Mid Cap funds provide transparency regarding holdings and performance. Investors can easily access information about the fund’s portfolio and track its performance regularly.
Advantages of Investing in Large & Mid Cap Funds
- Diversification: Large and mid-cap mutual funds offer investors the opportunity to diversify their portfolios across a range of companies of different sizes. This can help to reduce risk and increase the potential for returns.
- Growth potential: Mid-cap companies have the potential to grow faster than large-cap companies over the long term. This can lead to higher returns for investors.
- Liquidity: Large and mid-cap mutual funds are generally liquid, meaning investors can easily sell their funds when needed.
Risks Involved in Large & Mid Cap Funds
Large & Mid Cap funds offer a balanced approach to investing by combining large-cap and mid-cap stocks. While they have several advantages, it’s crucial to be aware of the potential risks associated with these funds:
- Market risk: Like all equity-oriented funds, Large & Mid Cap funds are subject to market risk.
- Volatility: Mid-cap stocks, in particular, tend to be more volatile than large-cap stocks. This volatility can lead to more substantial price swings, impacting the fund’s overall performance.
- Company-specific risk: Investing in a mix of large-cap and mid-cap stocks exposes the fund to company-specific risks. For example, if a significant holding in the mid-cap segment underperforms, it can affect the fund’s returns.
- Sector concentration: The fund’s allocation to specific sectors can lead to concentration risk. If a particular sector faces challenges, it can impact the fund’s performance, especially if it has significant exposure to that sector.
- Liquidity risk: Some mid-cap stocks may have lower liquidity, which can impact the fund’s ability to buy or sell these stocks at favourable prices, especially when the fund experiences high redemption pressures.
Factors To Consider Before Investing in Large & Mid Cap Mutual Funds
- Investment objective and risk tolerance: Evaluate if your investment goals and risk tolerance are line with the scheme. Large and mid-cap funds are generally considered to be less risky than small-cap funds, but they are still riskier than debt funds.
- Investment horizon: Large and mid-cap funds are best suited for investors with a long-term investment horizon, typically at least 5 years. Therefore, you should only invest funds that you don’t require in the short term and medium term.
- Fund’s expense ratio: The expense ratio is the percentage of your investment that is deducted to cover the fund’s operating costs. Higher costs result in lower returns, and vice versa. But this should not be the only deciding factor.
- Asset allocation: Consider the fund’s asset allocation. Some funds may invest more heavily in large-cap stocks, while others may focus on mid-cap stocks.
Who Should Invest in Large & Mid Cap Mutual Funds?
Large and Mid Cap Funds can be a good investment for various investors, but they are especially well-suited for those who:
- Have a long-term investment horizon: Large and mid-cap funds can experience volatility in the short term, but they have historically outperformed other asset classes over the long term.
- Are willing to take on some risk: Large and mid-cap funds are riskier than other safe investment options but can offer higher returns.
- Are looking to diversify their portfolios: Large and mid-cap funds can help investors diversify their portfolios across different sectors of the economy.
- Have a moderate to high-risk tolerance: Large and mid-cap funds are not suitable for risk-averse investors.
Taxability of Large & Mid Cap Funds
Large & mid cap funds come under the equity-oriented funds category, which is taxed as per their holding period:
- Short-Term Capital Gains (STCG): If the holding period of the fund is less than a year, they are considered as STCG. These gains are taxed at 15%.
- Long-Term Capital Gains (LTCG): If the holding period of the fund is more than a year, they are considered as LTCG. If these gains are less than ₹1 lakh, they are tax-free. If they are more than ₹1 lakh, the gains are taxed at 10%.
How to Invest in Large & Mid Cap Funds?
Investing in Large & Mid Cap Funds funds through your Angel One account is a streamlined process that involves a few simple steps:
Step 1: Begin by logging in to your Angel One account using your registered mobile number. After logging in, validate the OTP (One-Time Password) for security purposes, and then enter your MPIN to access your account.
Please note that if you don’t have a Demat account with Angel One, you can open one quickly by completing the KYC (Know Your Customer) procedure and submitting the necessary documents.
Step 2: Once you’ve successfully logged in, it’s time to choose the most suitable mutual fund based on your financial needs and risk profile. You can evaluate various funds by navigating to the mutual fund section on the Angel One app. During this stage, consider the following factors:
- Search for the specific fund you wish to invest in or take recommendations from funds listed by Angel One across different categories.
- Analyse the fund’s historical performance, tax implications, constituent sectors, and the stocks it comprises.
- Utilise the provided calculator to estimate potential returns.
- Assess the level of risk associated with the fund and compare it to your risk tolerance.
- Check the fund’s ratings assigned by reputable rating agencies, typically on a scale from 1 to 5.
- Take note of the fund’s expense ratio, which provides insight into the cost of investing in it.
Step 3: After finalising the fund(s) you want to invest in, navigate to your Angel One account’s Mutual Funds section and search for your chosen fund. Since investing in mutual funds often involves a long-term commitment, exercise caution when selecting the fund(s) you intend to invest in. During this stage, consider the following:
- Decide whether you want to invest a lump sum amount or set up a monthly Systematic Investment Plan (SIP).
- Enter the investment amount you are comfortable with and choose your preferred payment method. UPI is the recommended mode, but you can also opt for net banking.
- After placing your order, you can establish a mandate for hassle-free future instalments if you’ve chosen the SIP investment route.
Top 10 Large & Mid Cap Mutual Funds to Invest in
| Name of the fund | AUM (₹ in crore) | Minimum Investment (₹) | CAGR 3Y (%) | CAGR 5Y (%) |
| Quant Large & Mid Cap Fund | 1,111.43 | 5,000 | 30.94 | 20.75 |
| Mirae Asset Emerging Bluechip | 29,024.00 | 5,000 | 24.90 | 20.47 |
| Kotak Equity Opp Fund | 15,013.39 | 100 | 25.73 | 20.22 |
| HDFC Large and Mid Cap Fund | 11,197.54 | 100 | 32.25 | 19.40 |
| Tata Large & Mid Cap Fund | 5,331.34 | 5,000 | 24.99 | 19.11 |
| Edelweiss Large & Mid Cap Fund | 2,246.63 | 5,000 | 25.49 | 19.09 |
| ICICI Pru Large & Mid Cap Fund | 9,177.04 | 5,000 | 32.16 | 18.69 |
| SBI Large & Midcap Fund | 14,682.26 | 5,000 | 27.93 | 18.66 |
| Navi Large & Midcap Fund | 270.22 | 10 | 26.38 | 18.55 |
| Canara Robeco Emerging Equities Fund | 17,939.37 | 5,000 | 22.74 | 18.13 |
Note: The best 10 large & mid-cap funds are as of October 20, 2023. These funds are sorted as per the 5-year CAGR.
Quant Large & Mid Cap Fund
This large & mid-cap fund from quant Mutual Fund was launched on December 12, 2006. The expense ratio of this fund is 2.15%, and the Assets Under Management (AUM) is ₹1,111.43 crore. The minimum investment required for Quant Large & Mid Cap Fund is ₹5,000.
Mirae Asset Emerging Bluechip
Mirae Asset Mutual Fund launched Mirae Asset Emerging Bluechip Fund on July 09, 2010. The expense ratio of this fund is 1.60%, and the AUM is ₹29,024 crore. The minimum investment required for Mirae Asset Emerging Bluechip Fund is ₹5,000.
Kotak Equity Opp Fund
This fund was launched by Kotak Mahindra Mutual Fund on September 09, 2004. The expense ratio of this fund is 1.66%, and the AUM is ₹15,013.39 crore. The minimum investment required for Kotak Equity Opp Fund is ₹100.
HDFC Large and Mid Cap Fund
HDFC Mutual Fund launched HDFC Large and Mid Cap Fund on February 18, 1994. The expense ratio of this fund is 1.77%, and the AUM is ₹11,197.54 crore. The minimum investment required for HDFC Large and Mid Cap Fund is ₹100.
Tata Large & Mid Cap Fund
This fund was launched by Tata Mutual Fund on March 31, 1993. The expense ratio of this fund is 1.86%, and the AUM is ₹5,331.34 crore. The minimum investment required for Tata Large & Mid Cap Fund is ₹5,000.
Edelweiss Large & Mid Cap Fund
Edelweiss Mutual Fund launched Edelweiss Large & Mid Cap Fund on June 14, 2007. The expense ratio of this fund is 1.97%, and the AUM is ₹2,246.63 crore. The minimum investment required for Edelweiss Large & Mid Cap Fund is ₹5,000.
ICICI Pru Large & Mid Cap Fund
This fund was launched by ICICI Prudential Mutual Fund on July 09, 1998. The expense ratio of this fund is 1.80%, and the AUM is ₹9,177.04 crore. The minimum investment required for ICICI Pru Large & Mid Cap Fund is ₹5,000.
SBI Large & Midcap Fund
SBI Mutual Fund launched SBI Large & Midcap Fund on May 26, 2005. The expense ratio of this fund is 1.74%, and the AUM is ₹14,682.26 crore. The minimum investment required for SBI Large & Midcap Fund is ₹5,000.
Navi Large & Midcap Fund
This fund was launched by Navi Mutual Fund on December 07, 20158. The expense ratio of this fund is 2.26%, and the AUM is ₹270.22 crore. The minimum investment required for Navi Large & Midcap Fund is ₹10.
Canara Robeco Emerging Equities Fund
Canara Robeco Mutual Fund launched the Canara Robeco Emerging Equities Fund on March 11, 2005. The expense ratio of this fund is 1.65%, and the AUM is ₹17,939.37 crore. The minimum investment required for the Canara Robeco Emerging Equities Fund is ₹5,000.
Large & Mid Cap Funds FAQs
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