Mirae Asset Midcap Fund: Stay away from this asset gathering exercise

MIrae Asset Midcap Fund

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Mirae Asset Midcap Fund is the latest NFO from Mirae Mutual Fund. The fund house has been busy shuffling its funds. First, it made Mirae India Equity fund into Mirae large Cap Fund in March (effective 1st May 2019). Then it announced a multicap NFO Mirae Asset Focused Fund in April 2019 and now a Midcap fund.

From AMC’s point of view, this is an asset-gathering exercise. They are in the good books of the distributor community (they need to be in the absence of a bank to drive sales) and each time there is an NFO, they will press all the right buttons (including the media) to drive sales.

As an investor, this kind of gymnastics ought to be plain repulsive. The NFO presentation of Mirae Asset Midcap Fund makes a song and dance about how it is the right time to invest in midcaps (what else would it say anyway!). If that is the case, why not open lump sum investments in Mirae Asset  Emerging Bluechip fund?

The AMC still claims emerging bluechip is “primarily a midcap fund”. Lump-sum investments were suspended in Oct 2016 when AUM was only ~ 3100 Crores and not opened yet! It has happily driven sales in this fund via SIPs and STPs (current AUM ~ 7700 Cr)

There is nothing unique about Mirae Asset Midcap Fund. It says the usual stuff about “unearthing opportunities”, “invest in future large caps”, blah blah. Most people who are reading this will have zero need for a midcap fund in their portfolio.

Even if they do, they can happily invest in any of the midcap funds with a fantastic track record. See for example DSP Midcap Fund Review: A Top Three Performer! You can screen for such funds in any category with the Equity Mutual Fund Performance Screener

If the investor has a deluded love for Mirae Mutual Fund, they can start a SIP in Mirae Emerging Bluechip. It has all the midcap one needs, is managed by a good fund manager: Neelesh Surana since May 2010 (at the time of writing, things change quick and smooth in this space).

There is no flaming need to invest in Mirae Asset Midcap fund unless you are tricked into believing getting units at a NAV of Rs. 10 per unit will make a big difference to your life.

Suggestions:

1: Do not get married to Fund Houses or their products

2: Unfollow all AMC folk on social media. You will sleep a lot better.

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About the Author M Pattabiraman author of freefincal.comM. Pattabiraman(PhD) is the author and owner of freefincal.com.  He is an associate professor at the Indian Institute of Technology, Madras since Aug 2006. Pattu” as he is popularly known, has co-authored two print-books, You can be rich too with goal based investing (CNBC TV18) and Gamechanger and seven other free e-books on various topics of money management.  He is a patron and co-founder of “Fee-only India” an organisation to promote unbiased, commission-free investment advice. Pattu publishes unbiased, promotion-free research, analysis and holistic money management advice. Freefincal serves more than one million readers a year (2.5 million page views) with numbers based analysis on topical issues and has more than a 100 free calculators on different aspects of insurance and investment analysis. He conducts free money management sessions for corporates  and associations(see details below). Previous engagements include World Bank, RBI, BHEL, Asian Paints, TamilNadu Investors Association etc. Contact information: freefincal {at} Gmail {dot} com (sponsored posts or paid collaborations will not be entertained)
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7 Comments

  1. Very true. I’ve been waiting for lump sum investment in emerging blue chip fund. As you mentioned it’s pure marketing to increase AUM. I’m losing confidence on MIRAE.

  2. And then how can you forget Mirae asset emerging bluechip was a Focused (Multicap) fund which is now change to large & midcap and a new focused fund is launched. Do u really think it’s good to invest in their focused fund??

  3. calling ‘a spade’ to a spade needs clarity of ideas and courage! i like your first suggestion timely for me: 1: Do not get married to Fund Houses or their products, and for second, i don’t still indulge! yes, i have investment in its emerging bluechip and could not invest more due to restriction now.

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