While small-caps have delivered higher returns than their large-cap peers, investors would do well to recognise the incremental risk of investing in these companies.
If you want his advice on your mutual fund investments, please mail your questions to getahead@rediff.co.in with the subject line, 'Mutual Fund Query', along with your name, and Omkeshwar will offer his unbiased views.
Inflows into sector and thematic (S&T) funds fell sharply from around 5,711.6 crore in February 2025 to about 170.1 crore in March 2025 - a decline of 97 per cent. With many such funds underperforming, investors need to assess whether to remain invested or exit.
Why try to time the market when time in the market works better? History shows that patient investors who stay the course often walk away with the real rewards, says Ramalingam Kalirajan.
Mid-cap and small-cap mutual fund schemes have continued to attract strong investor interest, garnering nearly Rs 30,350 crore in inflows during the April-September period of the current financial year, driven by impressive returns delivered by these segments. In comparison, the cumulative inflow into mid-cap and small-cap funds stood at Rs 32,924 crore during the same period last year, according to data from the Association of Mutual Funds in India (Amfi).
Ask rediffGURU and PF and MF expert Janak Patel your mutual fund and personal finance-related questions.
The recent stock market crash has been particularly harsh on one investment category -- mid cap stocks/funds. Compared to their large cap peers, mid cap stocks/funds have fallen more sharply. The view that many frustrated investors might take is that investing in mid caps was a bad idea in the first place. And they can't really be blamed, in many ways mid caps were presented as an opportunity to make quick money without informing the investor of the higher risk involved.
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With the Big Four information technology services players having disappointed the Street, the focus is on mid-cap IT players who seem to have met expectations, according to analyst reports and management commentary on the demand environment.
'As valuations of large-caps appeared to be out of whack, investors started lapping up quality mid-caps and small-caps, which were available at relatively comfortable valuations.'
Ask rediffGURU and PF and MF expert Janak Patel your mutual fund and personal finance-related questions.
Most of the large mid-caps share similar business model as the large-caps and have more of less similar set of clients.
Operator syndicate could be behind stock hammering, suspects regulator.
Though many such funds may not make the grade, it would be foolhardy to ignore them
'Selling could further intensify and take the index towards 22,800-22,750 in the near-term.'
The rally in Indian mid-and smallcap indices thus far in calendar year 2024 (CY24) has been the best in class across the world, eclipsing the global FTSE benchmarks, and also out running peers from other leading world stock markets. This is despite the correction in the mid-and smallcap segments back home seen in the last few days, triggered by valuation concerns, geopolitical developments amid nervousness ahead of the July - September 2024 (Q2-FY25) corporate results season.
As regards mid-caps and small-caps, analysts suggest investors buy only those stocks of those companies where there is earnings visibility for at least a few quarters and where the valuations have become reasonable.
The worst may perhaps be over for these stocks, suggests Sanjay Kumar Singh.
Three fund managers share their views and state where they are looking for value.
Unless these companies falter on growth or external and domestic factors play spoilsport, analysts expect them to do well
Equity mutual funds (MFs) capped a strong 2024 with near-record inflows in December. With net inflows of Rs 41,156 crore in December, the 2024 tally surged to Rs 3.9 trillion, up 144 per cent compared to 2023. The December tally, which was only slightly short of the record-high inflows of Rs 41,887 crore achieved in October 2024, was fuelled by record inflows of Rs 9,761 crore into small-cap and mid-cap funds.
It was just a couple of months ago when mid caps stocks were a rage.
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A total of 10 new stocks have been included in BSE Mid-Cap index, while 12 existing ones would move out.
Global funds have pulled out Rs 1.54 trillion from domestic stocks in fiscal 2024 - 25 (FY25), the highest-ever outflow recorded so far, according to the data compiled by Business Standard. The last time the global funds exited Indian shores in droves was back in 2022, when they sold a net Rs 1.41 in the backdrop of Covid-19.
It is advisable to stick to mid-caps with sustainable financial metrics rather than those offering the promise of faster growth.
The BSE Small-Cap Index (up 34 per cent) and the BSE Mid-Cap Index (up 28 per cent) have outperformed the Sensex (up 16 per cent) in the last two-and-a-half months, while the NSE Junior Nifty (up 25.4 per cent) and the NSE Mid-Cap Index (up 30.2 per cent) have beaten the S&P CNX Nifty (up 20.4 per cent) during the same period.
Mid-cap stocks have emerged as the clear favourite of investors, both institutional as well as retail, if returns in the last two months is any indication.
Stakes raised significantly in select companies during Dec quarter, pushing sectoral indices up more than larger peers.
'My advice: Don't mark your portfolio to market every day. Focus on survival.'
Investors became richer by nearly Rs 8 lakh crore on Wednesday as benchmark BSE Sensex surged by 740 points amid value buying in utilities and power shares and a strong trend in global markets. The 30-share BSE Sensex surged by 740.30 points or 1.01 per cent to close at 73,730.23.
Sluggish volume growth and mark-to-market losses have affected the performance of a majority of mid-cap information technology companies in the January-March 2008 quarter. Analysts expect that growth will continue to be sluggish in the next two quarters.
Buying stocks during a dip, says Amar Nandu, research analyst, Samco Securities, can lead to higher compounding returns when the uptrend begins.
Investor confidence in value mutual funds remains robust, with the category witnessing an inflow of Rs 1,556 crore in January, indicating a shift in their focus towards fundamentally strong yet undervalued stocks.
'Earning expectations remain strong.'
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