Large & mid-cap mutual funds vs separate portfolio split: How do their returns compare over 1, 3 and 5 years?

If you want exposure to both large-cap and mid-cap stocks, should you invest in a single large & mid-cap fund or choose separate large-cap and mid-cap funds ? The answer may depend on how much exposure you want to each segment and how the fund’s portfolio is positioned.

Large & mid-cap funds offer investors exposure to both segments within a single scheme. Under Securities and Exchange Board of India ( SEBI ) categorisation rules, these funds must invest at least 35% of their assets each in large-cap and mid-cap stocks.

AMFI 's latest data shows that large & mid cap funds received ₹ 3,872.79 crore in inflows, while large-cap funds saw an outflow of ₹ 1,147.36 crore. However, mid-cap funds attracted ₹ 6,989.40 crore in August.

Large & mid-cap funds outperformed the benchmark, BSE Large MidCap TRI, across all three periods. The category delivered 2.55% over one year, compared with -1.54% for the benchmark.

Over three years, the category returned 12.25% versus 9.16% for the index, while its five-year return of 12.41% was higher than the benchmark’s 9.39%.

The category also outperformed large-cap funds across all three periods. However, mid-cap funds delivered the highest returns among the three categories, with returns of 7.48% over one year, 15.48% over three years, and 16% over five years.

Interestingly, the margin of outperformance over the benchmark was higher for large & mid-cap funds.

They beat the BSE Large MidCap TRI by 3.09 percentage points over one year, 3.09 percentage points over three years and 3.02 percentage points over five years. In comparison, mid-cap funds outperformed the BSE 150 MidCap TRI by 2.15, 1.18 and 0.31 percentage points, respectively.

Among the top-performing funds in their respective categories, Motilal Oswal Large and Midcap Fund delivered 19.23% over five years, compared with 13.19% for Nippon India Large Cap Fund and 22% for Motilal Oswal Midcap Fund.

The portfolios also help explain why returns can differ across categories. A large & mid-cap fund can invest across both segments, while large-cap funds must invest at least 80% in large-cap stocks and mid-cap funds at least 65% in mid-cap stocks, as per category-level guardrails.

Disclaimer: This is purely for educational/informational purposes and should not be taken as any sort of investment advice. Always consult a SEBI-registered advisor before making any investment decisions.

Sheetal Goel is a Content Producer at Livemint, where she covers corporate developments, personal finance, business trends, markets, and SEBI-related updates. She focuses on simplifying complex financial concepts and presenting them in a clear, reader-friendly manner, thereby helping audiences better understand investment trends, personal finance, and market developments. Her writing focuses on making finance more accessible to everyday readers while maintaining clarity, accuracy, and relevance. <br><br> She holds a degree in Economics (Hons.) along with an MBA in Finance, which has helped her develop a strong foundation in financial analysis, market understanding, and business reporting.