Mid-cap mutual funds are equity schemes that invest at least 65% of the fund's total assets in stocks and other equity instruments of mid-cap companies, i.e., companies that rank 101 to 250 by market capitalization. These funds carry lower risk than small-cap mutual funds, while offering better growth potential than large-cap mutual funds. They are therefore suitable for long-term investors with a moderate level of risk appetite.
Mid Cap Mutual Funds
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*₹10 lakh projection assumes ₹100/day for 11 years at an assumed 15% p.a.; actual returns will vary with the market.

What are Mid-Cap Mutual Funds?
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How Do Mid-Cap Mutual Funds Work?
When you invest in a mid-cap mutual fund scheme, your money is added to the pool that your fund manager uses to build a portfolio of mid-size companies. In such mutual fund schemes, a fund manager usually actively decides and distributes the pooled money across various sectors and industries, alter holdings as these companies rise or fall from their initial positions and aims to manage risk while seeking growth. They manage the portfolio and review the companies regularly.
How to Invest in Mid-Cap Mutual Funds?
Investing in mid-cap funds through Paisabazaar is quick and easy. Simply, follow these steps to invest in these funds:
- Step 1: Login the Paisabazaar app.
- Step 2: Tap on "Mutual Funds" on the home screen.
- Step 3: Browse through the available mid-cap fund options or search for your preferred fund directly.
- Step 4: Choose whether you want to invest in the scheme 'One-time' or through 'SIP'.
- Step 5: Provide a few more details and make payment to complete the process.
Mid-Cap Mutual Fund Taxation
Mid-cap mutual funds are taxed like any other equity mutual fund. Capital gains, i.e., profits made after selling these funds partially or fully, are taxed as below:
- Short-Term Capital Gains (STCG): Redeeming units before completing 12 months, qualifies as a short-term capital gain and is taxed at 20%.
- Long-Term Capital Gains (LTCG): Redeeming units after 12 months, qualifies as a long-term capital gain and you get an annual LTCG exemption of up to Rs 1.25 lakh on it.
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FAQs
Who should invest in mid-cap mutual funds?
Mid-cap funds suit investors with a medium to long-term investment horizon and who want to expand their equity exposure beyond traditional large-cap funds.
What is the minimum amount to invest in mid-cap funds?
You don't need a large amount of money to start investing in mid-cap funds. Most AMCs offer SIP options (like daily SIP and monthly SIP) that allows you to make investment contributions at regular intervals at amounts usually starting as low as ₹500. Alternatively, you can opt for a daily SIPs, with some schemes allowing investments starting from just ₹10 a day.
Is a mid-cap fund safe?
Despite their popularity, mid-cap mutual funds are not completely safe as they invest in mid-sized companies whose stock prices fluctuate more than those of established large-cap companies.
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- Mutual fund investments are subject to market risks. Please read the scheme information and other related documents carefully before investing. Past performance is not indicative of future returns. Please consider your specific investment requirements before choosing a fund, or designing a portfolio that suits your needs.
- Paisabazaar Marketing and Consulting Private Limited is an AMFI registered Mutual Fund Distributor - ARN-336712 | ARN Validity period: 08 Aug 2025 to 07 Aug 2028

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