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Performance Evaluation of Mid-Cap Retail Equity Mutual Funds

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  • Abhay Kaushik

Abstract

Mid-cap funds invest in stocks with a market cap between $2 billion and $10 billion. Some of the mid-cap firms recently overcame their small-cap status, but are still in the high growth mode with a better market positioning and stronger balance sheet. Because of their size and status, mid-cap stocks offer a unique platform to portfolio managers of mid-cap funds to earn superior returns by using their selectivity skills. This study analyzes the performance and persistence of performance of 257 U.S. domiciled retail mid-cap funds from January 2000 to December 2017. The results of this study suggest that despite the interesting platform offered by these stocks, it is not easy for fund managers to pick the stocks that beat the market. The results of this study show that mid-cap funds do not outperform the market and their poor performance persists over time.

Suggested Citation

  • Abhay Kaushik, 2019. "Performance Evaluation of Mid-Cap Retail Equity Mutual Funds," International Journal of Finance & Banking Studies, Center for the Strategic Studies in Business and Finance, vol. 8(2), pages 09-17, April.
    • Handle: RePEc:rbs:ijfbss:v:8:y:2019:i:2:id:301
    DOI: 10.20525/ijfbs.v8i2.301
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    References listed on IDEAS

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    1. Blake, Christopher R & Elton, Edwin J & Gruber, Martin J, 1993. "The Performance of Bond Mutual Funds," The Journal of Business, University of Chicago Press, vol. 66(3), pages 370-403, July.
    2. Carhart, Mark M, 1997. "On Persistence in Mutual Fund Performance," Journal of Finance, American Finance Association, vol. 52(1), pages 57-82, March.
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