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1 Mid-Cap, 1 Small-Cap Mutual Fund SIPs For Upto 116% Return: Top Rated By Morningstar

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During the FY 2021-2022, the inflows in the mutual fund & SIP industry have been magnificent, according to the Association of Mutual Funds in India (AMFI). Via SIPs inflows have reached more than Rs. 1.24 lakh crore, which is a sharp gain of 30% from the last fiscal. During FY 2020-2021, the inflow stood at Rs. 96,080 crore via SIPs, according to an Association of Mutual Funds in India (AMFI) data.

 

However, this month, the stock markets are not performing well, and investors should be more careful before selecting a mutual fund or SIP. Here, two mutual fund and SIP investment options, rated by reputed rating agency Morningstar, have been discussed with their portfolios and previous years' returns. These mutual fund SIPs are offered by the Axis mutual fund house.

1. Axis Midcap Fund - Direct Plan - Growth
 

1. Axis Midcap Fund - Direct Plan - Growth

Axis Midcap Fund - Direct Plan - Growth's NAV stood at Rs. 68.75, and its fund size is Rs. 17678.92 Crore. The Expense ratio is 0.46%, while the category average is 0.88%.

This fund's absolute returns of SIP have been the most lucrative in long-term. In the last 1 year its SIP return stood at -5.66%, in the last 2 years it has fetched 17.67% returns, in the last 3 years it has fetched 35.16% returns, and in the last 5 years it has fetched 58.81% returns. In the past 2 years, this Fund's annualized returns of SIP stood at 16.53%, and stood at 20.59% in the past 3 years.

This mutual fund's annualized returns were best in the short term. In the last 1 year its mutual fund return stood at 9.32%, in the last 2 years it has fetched 81.02% returns, in the last 3 years it has fetched 77.24% returns, and in the last 5 years it has fetched 130.71% mutual fund returns. In the past 2 years, this Fund's annualized mutual fund returns stood at 34.54%, however, the category average was marginally better at 44.55%.

This Fund's Equity Holding is 85.35%, and 14.39% is in other sectors. This fund's Large Cap Investments are 11.72%, Mid Cap Investments are 45.61%, Small Cap Investments are 12.82%, and 15.46% investments are allocated in the other funds. The top 5 equity holdings of the fund are: Cholamandalam Investment & Finance Co. Ltd., ICICI Bank Ltd, Astral Ltd., Trent Limited, Bajaj Finance Ltd.

2. Axis Small Cap Fund - Direct Plan - Growth

2. Axis Small Cap Fund - Direct Plan - Growth

Axis Small Cap Fund - Direct Plan - Growth's NAV stood at Rs. 63.96, and its fund size stood at Rs. 9261.23 Crore. The Expense Ratio of the fund is 0.35%, while the category average is 0.75%. However, the stock markets are bearish at the present moment, so, the returns from mutual funds and SIPs are falling. So, an investor should follow the previous returns from the mutual funds thoroughly.

In the last 1 year its SIP return stood at 1.9%, in the last 2 years it has fetched 36.61% returns, in the last 3 years it has fetched 58.17% returns, and in the last 5 years it has fetched 86.24% returns. In the past 3 years, this Fund's annualized returns of SIP stood at 32.19%, and in the past 2 years it stood at 33.30%.

In the last 1 year its mutual fund return stood at 20.16%, in the last 2 years it has fetched 135.75% returns, in the last 3 years it has fetched 116.15% returns, and in the last 5 years it has fetched 153.81% mutual fund returns. In the past 2 years, this Fund's annualized mutual fund returns stood at 53.54%, although the category average was marginally higher at 61.80%.

This Fund's Equity Holding is 79.81%, and 20.19% is in other sectors. This fund's Large Cap Investments are 0.36%, Mid Cap Investments are 3.73%, Small Cap Investments are 60.59%, and 15.13% investments are allocated in the other funds. The top 5 equity holdings of the fund are: Galaxy Surfactants Ltd., Narayana Hrudayalaya Ltd., Brigade Enterprises Ltd., Fine Organic Industries Ltd., Birlasoft Ltd.

Small-cap and mid-cap mutual fund investment rationale

Small-cap and mid-cap mutual fund investment rationale

Small cap mutual funds invest in the small cap stocks listed in the equity markets. On the other hand, the mid cap mutual funds invest in the mid cap companies listed in the equity markets. Small cap stocks generally have a market capitalization of less than Rs. 5000 crore. The small cap mutual funds will choose stocks mostly from the small cap companies, however, they can have a marginal investment in the large cap and mid cap companies too. A small cap mutual fund can select all stocks except the largest 250 stocks depending on their market capitalization.

Mid cap mutual funds can select company stocks in the mid cap category. The mid cap stock will have a market capitalization of above Rs. 5,000 crore but less than Rs. 20,000 crore. These stocks will be ranked between 100 to 250 by their market capitalization. A mid cap mutual fund can invest in all stocks, but most of its investment should be in the mid cap category.

The large cap and mid cap companies are known to be less risky, while the small cap mutual funds can pose more risks regarding liquidity. So, investors should select the funds based on their risk appetite.

Disclaimer

Disclaimer

Investing in equities/mutual funds/SIPs poses a risk of financial losses. Investors must therefore exercise due caution. Greynium Information Technologies, and the author are not liable for any losses caused as a result of decisions based on the article.

(Data mentioned as on May 20, 2022)

Read more about: mutual fund mutual funds sip
Story first published: Monday, May 23, 2022, 21:27 [IST]
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