Mid-cap, small-cap funds shine in H1

The broader market outperformance in the first half of 2021 has helped mid-cap and small-cap mutual funds outshine large-cap funds by a big margin. The returns kept increasing down the ladder, said analysts about the stock performance in January-June period.

The top five small-cap funds, ranked by the size of their assets under management (AUM), have given returnsa between 30 per cent and 44 per cent in the last six months period. This is way higher than the returns of the top five large-cap funds, which grew by 11.69 per cent to 20.48 per cent. The top five mid-cap funds by AUM have given returns ranging between 22.82 per cent And 32.76 per cent.

These top performing funds are managed by the top 10 fund houses by AUM.

The large-cap indices— Sensex, Nifty-50 and BSE

100—have given returns of

11.76 per cent, 14.85 per cent and 15.20 per cent, respectively, during the last six month period.

But broader market returns are much higher, with the BSE Mid-cap Index’s return at 26.27 per cent, Nifty Mid-cap’s, at

28.06 per cent and BSE Small-cap’s, at 40.85 per cent.

These top performing funds are managed mostly by the mutual fund industry's top 10 fund houses.

For some of the smaller asset managers in the midcap and small-cap categories the outperformance is even higher, like in cases of Edelweiss Midcap Fund (33.08 per cent),

Quant Mid-cap Fund (36.16 per cent), Quant Small-cap Fund (66.93 per cent) and BOI-Axa Small-cap Fund (40.02 per cent).

Mid- and small-cap scrips continued to fare better than their larger peers for the second consecutive month even during the second wave of the pandemic, according to a report by Tata Mutual Fund.

"This is evident from the performance of the broader market indicator— CMIE Overall Share Price Index (Cospi), which housed 2,810 actively traded scrips in May 2021. The Cospi rose by 7.8 per cent, outperforming the Nifty 50 and the S&P BSE Sensex by 1.3 per cent each," Tata Mutual Fund said.