March 28, 2011 9:40 am
Pls suggest a good mid cap mutual fund.
Currently I am investing in BSL Midcap fund and its ratings seem to be going down (ValueResearch)
No fund is perfect for life! You need to keep revisiting the fund performance and monitor fund protfolio.
I would recommend ICICI Prudential Discovery and HDFC Mid-Cap Opportunities.
Birla Sun Life Midcap is a good fund. As you may be able to see from its performance graph on this link – http://goo.gl/Yb0tH, it has almost replicated CNX Mid cap (its benchmark) over last couple of years & beaten it for last 1 year.
What you must understand is that ratings are more of a “relative” measure of performance. So is any MF rating website is showing a lesser rating that means fund hasn’t performed well relative to its peers in most recent period.
Also, if you analyze the market performance for last 1 year or so, you would observe that its the Large-cap who have LED the RALLY. If thats the case, a pure mid-cap fund is bound to under-perform the SENSEX/ NIFTY. And most mid-cap funds actually also have some part invested in Large-cap companies. Birla Sun Life Mid-cap’s portfolio – http://goo.gl/Yb0tH – you would notice has still more mid-cap exposure than most mid-cap oriented Mutual Funds. So, the fund has actually suffered by sticking to its mandate 🙂
So, the point is market has been led by Large cap companies. And you invested in Birla Mid cap which is a mid-cap fund. You taking a decision based on ratings would be a wrong decision. Had the fund under-performed its benchmark, you could have considered exiting. Its not the case here.
We would not advice you to shift out of this fund. However, if you wish to explore more, you can see this page – http://goo.gl/8S39z
Hope this helps.
Santosh Navlani | moneysights.com
Ratings are not the correct way of investing / redeeming any fund.
That way, you will never be able to get nice returns because you will always be chasing returns.
DSPBR Small and Mid Cap Reg can be a good choice . However i would like to understand at what tenure return have you looked at BSL ? When did you invest in it and on what basis are your judging it . Note that you need to review it after a long term to judge how it is doing .. Just some percentage point up or down in short term does not mean anything .
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