Skip to content

Active vs Passive Investing: Mid Cap Equity Mutual Funds

Last week I had posted a comparison of large cap funds with few relevant indices.  This time let us do the same with mid-cap funds - compare SIP and Lump Sum returns over the last 1,2,3,4,5,6,7,8,9 years.

As before, a passive mutual fund is just an index (either cap-based or strategic). The expenses associated with investing in such a passive fund are ignored so that it is that much harder for active funds to beat them. Therefore, no ETFs or index funds are included in this study.

Nifty Next 50 (price index) 

The top 51 to 100 in terms of market cap traded at the NSE. Not exactly a mid-cap index, but I was curious. See why: Evaluating the Nifty Next 50 as an Index Fund

mid-cap-nifty-next-50

 

Above 3Y a good 70% of  mid-cap funds have outperformed. Not bad. This excludes dividends though.

Nifty Free Float Mid Cap 100 (price index) 

This defines a mid-cap by calculating the number of actively traded shares, excluding those held by promoters, the govt. etc. Read more hereStocks are among the bottom 25% in terms of free-float market cap (excluding the bottom 10%). Nifty 50 stocks are excluded. Principal Index Fund tracks this. This is a better representative of the mid-cap segment than other NSE mid-cap indices (50, 150)

mid-cap-nifty-free-float-mid-cap-100

Here too, similar story. But excluding dividends.

BSE Mid Cap (Total returns index) 

This represents the 71% to 85% of the average daily total market capitalization of the BSE.

mid-cap-bse-mid-cap-tri

hmm interesting!

BSE Select Mid Cap (Total returns index) 

Thiry largest and most liquid from the above index are part of this.

mid-cap-bse-mid-cap-select-tri

Now, what do we have here! Somebody should create an index mutual fund based on this index. That is impressive. A good ~ 50% of mid-cap funds could not beat this index.

Caveat: this was launched only in Jun 2015. Much of this data is back-calculated. Will this performance repeat in real-time? Watch this space 🙂

You Can Be Rich Too Offers

you-can-be-rich-too

My new book with PV Subramanyam, published by CNBC TV 18

The book comes with 9 online calculator modules to create your own financial plan.
Amazon Now 33% off Hardcover ₹ 267 (prime)  ₹ 307 (normal)
Kindle (₹ 244.30)

Infibeam ₹ 280 with Coupon BS10

Googe Play Books App Store (₹ 244.30)

What Readers Say

A must book for everyone who wants to take control of personal finance. Nice explanation of how a debt mutual fund works. Bonds trading and indexation benefits in high inflation years were something new I learnt. After reading this book you will be able to easily choose any funds, because you will know what that fund does or how that fund works By Amazon Customer on 17 December 2016

You can read all reviews here

 

Free Apps for your Android Phone

Install Financial Freedom App! (Google Play Store)


Install Freefincal Retirement Planner App! (Google Play Store)


Find out if you have enough to say "FU" to your employer (Google Play Store)


About Freefincal

Freefincal has open-source, comprehensive Excel spreadsheets, tools, analysis and unbiased, conflict of interest-free commentary on different aspects of personal finance and investing. If you find the content useful, please consider supporting us by (1) sharing our articles and (2) disabling ad-blockers for our site if you are using one. We do not accept sponsored posts, links or guest posts request from content writers and agencies.

Blog Comment Policy

Your thoughts are vital to the health of this blog and are the driving force behind the analysis and calculators that you see here. We welcome criticism and differing opinions. I will do my very best to respond to all comments asap. Please do not include hyperlinks or email ids in the comment body. Such comments will be moderated and I reserve the right to delete the entire comment or remove the links before approving them.

1 thought on “Active vs Passive Investing: Mid Cap Equity Mutual Funds

Do let us know what you think about the article

%d bloggers like this: