Top Mid Cap vs Top Small Cap 10-year Return Calculator: Mid cap mutual funds need to have at least 65 per cent of their investments in mid cap stocks, while small cap mutual funds need to have at least 65 per cent of their investments in small cap stocks, as per Securities Exchange Board of India’s (Sebi) mutual fund classification.

Equity mutual fund investors keep these mutual funds in their portfolio for high growth, but these funds also slip fast during market fluctuations.

Know more about mid and small cap funds; which have been the best small cap and midcap mutual funds in terms of highest annualised SIP returns (XIRR) in 10 years, and which has created a higher corpus on a Rs 10,000 monthly SIP investment.    

What are mid cap mutual funds?

Mid cap mutual funds have most of their investments in the stocks that belong to firms in 101st to 250th places in terms of highest market capitlisation.

In that bracket, there are companies that have the capability to move to large caps or have slid from that category; and there is a bunch that has graduated from the small cap category or can slip to that category.

So, mid cap mutual funds can provide stability and growth.

But when the share market falls, mid cap mutual funds are most likely to slip faster than large caps.

However, they are more stable than small cap funds.

Investors keep mid cap mutual funds in their portfolio for their high return.

But the category is not suitable for investors with short-term investment horizon.

Investors who want to invest for at least 5 to 7 years can find mid cap mutual funds as a stable  option.  

What are small cap mutual funds?

These funds have most of their investments in the firms placed 251st and above in the highest market capitalisation firm list.

Since small cap companies are in their high growth stage, they have the potential to provide higher returns than large cap and mid cap firms.

But at the same time, they are not as fundamentally strong as large and mid caps and that gives them vulnerability during market fluctuations.

So, small cap mutual funds are the fastest to rise and the fastest to fall during market fluctuations.

During a sharp market rise, small cap mutual funds can provide good returns, but the category is suitable only for investors with a long-term investment horizon.

Best mid cap mutual fund with highest SIP return in 10 years   

The best mid cap mutual fund with highest SIP returns in the 10-year period is Motilal Oswal Midcap Fund – Direct Plan.

The fund has given 26.15 per cent annnualised SIP returns during that period. 

Best small cap mutual fund with highest SIP return in 10 years

Quant Small Cap Fund – Direct Plan is the top small cap mutual with best SIP returns in 10 years.

It has given 29.05 per cent annualised SIP returns during that time frame.

Motilal Oswal Midcap Fund – Direct Plan

The fund has assets under management (AUM) of Rs 18,604 core, while its net asset value (NAV) is Rs 121.6309.

Benchmarked against NIFTY Midcap 150 TRI, the fund has given 26.28 per cent annualised return (CAGR) since its inception in February 2014.

With an expense ratio of 0.58 per cent, the fund has Rs 500 as the minimum SIP and lump sum investment each. 

Quant Small Cap Fund – Direct Plan 

The fund has AUM of Rs 26,645 crore, while its NAV is Rs 296.0706.

Benchmarked against NIFTY Smallcap 250 TRI, the fund has given 20.03 per cent annualised return (CAGR) since its launch in January 2013.

With an expense ratio of 0.64 per cent, the fund has Rs 1,000 as the minimum SIP investment and Rs 5,000 as the minimum lump sum investment. 

Current value of Rs 10,000 monthly SIP investment in Motilal Oswal Midcap Fund – Direct Plan

A Rs 10,000 monthly investment in 10 years, or a total investment of Rs 12,00,000, has turned into Rs 48,00,538.

Current value of Rs 10,000 monthly SIP investment in Quant Small Cap Fund – Direct Plan 

A Rs 10,000 monthly SIP investment in the fund has swelled to Rs 56,15,210 in the 10-year time frame.