This is not a specially designated mid-cap fund but has figured in this category because of its relatively high exposure to this market-cap range. It started off in a difficult year but has managed a very consistent show since then, outperforming the indices and peers every year except its debut one.
While most mid and small-cap funds in the market tend to stick to a growth style of investing, this fund is managed in a value style. It hunts for undervalued stocks in the market and is market-cap agnostic. Value opportunities are often identified in sectors and companies in special situations such as cyclically low earnings, turnaround and revival plays and so on.
Recently, a high 45 to 55 per cent of the portfolio has been parked in large caps, 35 to 40 per cent in mid-caps and the rest in small-caps. This makes the fund overweight on large-caps relative to its peers.
The fund's returns since launch are at 18.2 per cent. On the basis of three and five year CAGR, it has outperformed its benchmark by 10 to 12 percentage points and peers by 2 to 3 percentage points. It has been ahead of its benchmark and peers in every year since launch but is yet to encounter a serious bear market like 2008.
The fund has outpaced its index and peers in the last one year, despite this being a challenging period for mid-cap funds. This could be owing to its tilt towards value investing, a style that has made a comeback since 2016.
A value fund to beat high market valuations.