There are multiple reasons why midcap and small-cap funds are trailing their benchmarks. For many mid-cap funds, it is the large-cap exposure that has put a lid on returns. Most mid-cap funds typically retain 10-20% exposure to large caps to maintain portfolio liquidity and hygiene.
There are multiple reasons why mid cap and small cap funds are trailing their benchmarks. For many mid cap funds, it is the large cap exposure that has put a lid on returns. Most mid cap funds typically retain 10-20% exposure to large caps to maintain portfolio liquidity and hygiene.
Experts reckon the structure of multi caps gives them a sizing edge over flexi caps. The meatier exposure to broader segments of mid caps and small caps makes a lot of difference. Multi-cap funds are emerging as a superior alternative for those seeking broader diversification. Should you invest in mid-cup funds?