Are small caps ready to overtake mid caps? Fund managers think so

For much of the past decade, midcap stocks have been the undisputed stars of India’s stock market. Investors who chose midcaps over small caps were rewarded with better returns and, often, lower risk. But a subtle shift in market leadership may be underway.

Fund managers bet on small caps

The change is already visible in flexi-cap fund portfolios. While these funds still maintain a bias towards large-cap stocks, many have steadily increased their exposure to small-cap ones.