A. Neeta, this fund, which was a star performer till 2008, has been struggling to keep up its performance. I have compared the BSE Midcap Index and a few other midcap funds with Reliance Growth Fund. After the market crash in 2008, it has not recovered at the same pace as other mid cap funds.

The reasons may be more than one – not getting its sector calls right, being excessively defensive in the market recovery period or its corpus has become too large (Rs 7,000 crore approximately) for it to be nimble in the mid cap space. It is also observed that the fund has been increasing its large cap component from around 30% in 2008 to more than 50% now. This could be because of the difficulty in deploying a larger corpus purely in midcaps. Other midcap funds too invest in large caps at times, but rarely to such an extent.