3 Best Midcap Mutual Funds to Invest in 2025: Analyst's Choice

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Are you looking for a game-changing investment for 2025? If yes, get ready to uncover the 3 hidden gems under the Best Mid Cap Mutual Funds, offering a perfect balance between stability and growth.

Now, without any further dues, this blog explores the top mid cap mutual funds for 2025, these picks could be your ticket to impressive returns in the coming year.

Let’s begin by understanding the meaning of midcap funds.

What are Midcap Mutual Funds?

Midcap mutual funds are a type of mutual fund investment that invests in mid-sized companies, ranging between 101 and 250 in terms of market capitalization. These companies offer high growth potential and can eventually grow into large-cap companies, generating higher returns over the long term. At least 65% of a midcap fund’s money is invested in mid cap stocks, making them a balanced choice with higher growth possibilities than large cap funds and lower risk compared to small cap funds.

Ready to level up your investments? Find out how simple and easy it is to invest in Mutual Funds with these best midcap mutual funds right at your fingertips.

3 Best Mid Cap Mutual Funds to Invest in 2025

Here are the 3 top mid cap stocks to invest in via a systematic investment plan in 2025:

Edelweiss Mid Cap Fund

The Edelweiss Mid Cap Fund was launched on 26th December 2007 and is a reliable option for investors over the years. With a total investment size (AUM) of Rs.8,270 crore, it has delivered 23.07% returns over 3 years and 18.57% returns over 5 years. This fund is a good choice for those looking for steady growth and long-term investment stability.

Let’s check the performance of the Edelweiss Mid Cap Fund with the help of a graph:

Now imagine, if you had started a SIP of Rs.3000 in this fund 5 years ago, your investment would be only Rs.1,80,000 whereas your profits will stand at a total of Rs.4,03,789 lakh as of now.

Furthermore, before starting a systematic investment plan (SIP), check out the current quality parameters of Edelweiss Mid Cap Fund:

As shown in the above table, the fund's stocks are slightly expensive P/E ratio (price-to-earnings ratio) of 34.04 and its earnings and sales growth of 16.18% and 14.68% are close to the average. It also has decent cash flow growth at 24.45%. This fund is a good option for investors who want stable returns without taking too much risk.

Invesco India Mid Cap Fund

Launched on April 19, 2007, the Invesco India Mid Cap Fund has grown to manage Rs.5,860 crore in investments. It has delivered 20.87% returns over 3 years and 18.45% returns over 5 years, making it a balanced option for investors seeking dependable returns without taking on too much risk.

Look at the below bar graph for the 3 and 5 years rolling returns:

If you had started a SIP of Rs.3000 that too 5 years ago, the total investment would be Rs.1,80,000. In comparison, your portfolio will show a whopping total of Rs.3,91,889 in today’s date.  

The next step is to check out the quality of this fund and for that, you need the following checks:

The Invesco India Mid Cap Fund stands out for its strong growth numbers. It has the highest earnings growth of 27.92%, sales growth of 20.37% and cash flow growth of 39.61% among the funds. At the same time, its stocks are on the pricier side P/E ratio of 34.44.

This fund is ideal for investors who are comfortable with some risk and want high returns over time.

Mahindra Manulife Mid Cap Fund

The Mahindra Manulife Mid Cap Fund, launched on 5th January 2018, is a relatively new fund but has performed exceptionally well. With Rs.3,460 crore in investments, it offers the highest returns among the three funds, with 27.17% returns over 3 years and 24.55% over 5 years. This fund is a great option for investors looking for strong growth and willing to invest in a newer fund with high potential.

Refer to the below graph to see the data more clearly:

If you had started a SIP of Rs.3000 that too 5 years ago, the total investment would be Rs.1,80,000. In comparison, your portfolio will show a whopping total of Rs.3,82,500 on today’s date.  

The next step is to check out the quality of this fund and for that, you need the following checks:

The Mahindra Manulife Mid Cap Fund invests in stocks at low valuations P/E ratio of 22.67, making it a value-for-money option. Its earnings growth is solid at 17.94%, though sales and cash flow growth is 12.68% and 14.98% is slightly on the lower side.

You can invest in this fund if you are looking for affordable investment options as the minimum amount to start a SIP is just Rs.100.

How Good Mid Cap Mutual Funds Are for You?

Here are some strong reasons that make a compelling case to invest in the best midcap mutual funds:

1. High Growth Potential

• Mid-cap companies are likely to grow into large-cap companies in the future.
• They offer excellent expansion potential and can deliver higher returns compared to large-cap funds.

2. Lower Risk Through Diversification

These funds spread investments across multiple mid-cap companies.

• Diversification reduces the risk of losses caused by economic changes.
• Investing in mid-cap funds is less risky than directly buying mid-cap stocks.

3. Affordable Investment Options

• You can start investing with as little as Rs.500 through a SIP.
• Lump sum investments start at just Rs.1,000, making it budget-friendly for all types of investors.

4. Regulated and Transparent

• SEBI ensures that mid-cap mutual funds are transparent.
• You can easily check details like NAVs, expense ratios and monthly portfolios on fund websites.

5. Flexible Investment Methods

• Lump Sum:Invest all your savings in one go, starting from Rs.1,000.
• Systematic Investment Plan (SIP):Invest smaller amounts regularly (monthly, quarterly, etc.) starting at Rs.500.

6. Balance of Risk and Returns

• While mid-cap funds offer higher returns, they carry less risk compared to Small Cap Mutual Funds.
• They provide a good balance for investors looking for both growth and stability.

Who Should Invest in Midcap Mutual Funds in 2025?

Midcap mutual funds can be a great option for certain types of investors, but they come with both potential rewards and risks. Here’s a simple way to find out who should consider investing in them in 2025:

1. Long-Term Investors: Midcap funds are best suited for those who are ready to invest for the long haul. These funds typically invest in companies that are still growing and may not be as stable as large companies. For your investment to really pay off, you should be prepared to hold onto it for 7 to 10 years. During this time, the companies may grow, but they might also face challenges, especially during economic slowdowns.
2. Investors Willing to Take On More Risk: Midcap funds are riskier than large-cap funds, but they also offer the potential for higher returns. If you are okay with a bit more risk in exchange for a chance at better profits, midcap funds are a good choice. Just keep in mind that the higher the risk, the bigger the ups and downs you might experience with your investment.
3. Those Who Can Handle Market Volatility: These funds can be more volatile, meaning their value may change quickly and sharply. If you are someone who can stay calm even when your portfolio drops suddenly and if you are not planning to cash out anytime soon, then midcap mutual funds will suit you well.

In short, midcap mutual funds are ideal for those who have a long-term outlook, are comfortable with volatility and are willing to take on more risk for the potential of higher returns.

To Conclude on Best Midcap Mutual Funds 2025

As you start the new financial year 2025, have you found that midcap mutual funds offer greater promise for growth? If yes, investing via SIP in these top analyst-recommended midcap funds now will keep you ahead with your financial goals.

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