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Mid-cap mutual funds are expected to make solid gains: Why you should be picky while selecting schemes

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Even with fund managers hunting within the confines of this narrow market cap band of Rs 10,000-Rs 30,000 crore, there is wide variation of quality within this basket. Some funds prefer to tilt towards larger mid-caps while some hunt much lower down the market cap ladder. Some funds diversify heavily to mitigate risk while a few take concentrated bets.

Mid-cap stocks made solid gains in 2020 and many expect this run to continue over the next 6-12 months. Funds investing in this space will ride this uptick, but simply chasing the category table toppers is not the right approach. Investors should take cognizance of aspects beyond mere returns.Mid-cap mutual funds nowadays are required to invest in a strictly defined set of stocks. At least 65% of the portfolio must be parked in companies ranked

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