At a time when investors are looking beyond basic index funds, there’s a growing interest in strategies that balance growth potential with controlled exposure to segments offering higher returns. Factor and midcap-based ETFs are gaining attention, and it’s for a good reason. With these funds, you can invest in emerging businesses or specific investment styles.
If you are looking to diversify beyond large-cap funds, you may consider these ETFs as a practical strategy to capture opportunities when markets evolve. In this blog, we have curated five ETFs under the factor and mid-cap categories for your convenience.
5 Factor and Midcap-Based ETFs Investors Are Tracking
Investors looking to diversify through ETFs might find these five-factor and mid-cap-based picks suitable for a moderately aggressive portfolio.
1. Motilal Oswal Nifty Midcap 100 ETF
The Motilal Oswal Nifty Midcap 100 ETF invests in mid-sized companies that are already established. However, these businesses still have further headroom or growth. With this ETF, you can gain exposure to companies that are in their expansion phase. The returns from these investments are typically higher compared to large caps.
However, a higher reward potential comes with moderate volatility. So, if you are comfortable with fluctuations in the market, this ETF might suit your portfolio.
- 1-Year return: 51%
- 3-Year return: 26%
- 5-Year return: 85%
- Expense ratio: 23%
2. Kotak Nifty Alpha 50 ETF
The Kotak Nifty Alpha 50 ETF invests in large and mid-sized companies that are still growing. This ETF helps investors gain exposure to businesses that are in their expansion phase.
The long-term return potential may look attractive, but this ETF also comes with moderate volatility.
- 1-Year return: 3.71%
- 3-Year return: 88.38%
- 5-Year return: 42.26%
- Expense ratio: 0.30%
3. ICICI Pru Nifty Midcap 150 ETF
If you are looking for an ETF that tracks a broader set of midcap companies, the ICICI Pru Nifty Midcap 150 ETF can be an option. It offers a diversified exposure across growing companies. Investors who want to spread their risk but stay focused on mid-cap businesses may consider including this ETF in their portfolio to reduce the risk of concentration.
However, you may experience sharper short-term movements, so it’s suitable for those with a longer investment horizon.
- 1-Year return: 8.71%
- 3-Year return: 88.88%
- 5-Year return: 152.12%
- Expense ratio: 0.15%
4. Mirae Asset Nifty Midcap 150 ETF
The Mirae Asset Nifty Midcap 150 ETF helps you gain exposure to a wide basket of mid-cap companies across different industries. It appeals to investors looking for exposure beyond the large-cap segment.
If you have a moderate to high risk profile, you may consider investing in this ETF. However, the diversification also helps to smooth extreme movements. Investors building a long-term portfolio with a growth-oriented allocation may find this ETF an option.
- 1-Year return: 9.14%
- 3-Year return: 89.97%
- 5-Year return: 113.37%
- Expense ratio: 0.06%
5. Nippon India ETF Nifty Next 50 Junior BeES
As a Juniorbees ETF, it tracks the Nifty Next 50 Index, which provides you with exposure to the companies that are placed just below the top large-cap segment. Many of these companies are considered future market leaders.
With this ETF, your portfolio gets a unique mix of stability and growth. Nifty Next 50 companies are already established, but they are still evolving. The risk involved with this ETF is lower compared to pure midcap ETFs, but higher than with large-cap companies. It might suit your portfolio if you want a gradual exposure to emerging leaders.
- 1-Year return: 7.1%
- 3-Year return: 85.65%
- 5-Year return: 110.01%
- Expense ratio: 0.17%
Conclusion
Factor and midcap-based ETFs bring you an opportunity to invest beyond traditional equity avenues. These ETFs help investors explore different strategies and capture growth as they diversify their portfolios.
In this blog, we have listed five ETFs that can help you gain exposure beyond pure large caps. Based on your risk profile and investment goals, you may consider any of these ETFs in your portfolio.
