In today’s era, where the trend of passive investment is increasing, mid-cap mutual funds have become a very popular and talked about investment option amongst investors as this provides returns that are likely to beat the index. But while investing in these funds, the most commonly asked question is ‘Is it safe to invest in mutual funds?’ Let us discuss the same.&nbsp;Investing in the mid-cap mutual fund does possess a risk that is higher than the index and large-cap funds but lower than the small-cap funds. This is because these funds are equity market-linked. Mid-caps funds invest in companies that have surpassed their introductory phase and are now in the growth phase having the potential to grow multi-folds. And this is why, these funds offer high returns and in turn, possess high risk.&nbsp; This investment option can be fruitful only when the investor is willing to be invested for a long term as one must understand that for a mid-cap company to become or enter the large-cap category, it takes time, and if an investor is invested throughout this transition phase, he can reap outstanding returns from the same. But this is not always the case, in extreme scenarios, tough markets have seen mid-caps fail and going insolvent. Over the long term, through a diversified midcap portfolio, midcap funds are able to deliver good returns to the investors.The CruxNobody can be certain about the safety of mid-caps funds because it is impossible to time the market. But if an investor does the needful analysis and research, consult with a financial advisor or expert, and commits to being invested for the long term, there are high chances that he will end up reaping amazing returns. So it is always advised to invest according to one’s feasibility and risk appetite.&nbsp;

is midcap mutual fund safe? is it safe for investment?

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