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I love the Midcap indexes - have been touting them for a long time as well. Years ago, people would shun indexes at all costs by having look at some of the poor Total Stock Market and S&P 500 index performances from say 2000-2005.
But I have always liked the Midcap indexes because they can't get super top heavy --- if a company grows too large and growth-y then they have outgrown the midcap index and gets kicked-out. Some have cited this as an issue with the general market indexes but it's not a problem with the midcap indexes - but it was fallen on deaf ears and people just don't like indexes - it's been ingrained into people's head.
IJH and MDY have 10-year annualized returns just over 10% as well as Vanguard's Midcap Index fund. This has been a practically worry-free investment for me that I don't need to closely monitor - just rebalancing. Been great as a pretty tax-efficient investment for me as well.
There are also some midcap variants as well - for example:
RFG - annualized returns:
3-yrs: +21.30% | 5-yrs: +14.93%
How many investors jumped on CGMFX 5 years ago? 5-yrs = -5.03% annualized return. The 10 year returns of the Midcap indexes have handily beaten highly recommended funds including DODGX, TAVFX, Ariel Fund plus way too many other All-Star funds to mention which has turned investors into a game of fund musical chairs. Hell even on the old FundAlarm site - a multi-cap fund such as Muhlenkamp was touted and mentioned many times for years by some investors. The past 10 year performance has been a dud and the Midcap indexes have absolutely killed or knocked the snot out of MUHLX - a multicap fund that could invest in any stock it wanted.
It's not the be-all end-all investment but too bad so many investors had a dislike for the S&P500 index and concluded that all index investments were not good and could've used the Midcap indexes strategically. I use a combination of indexes and active funds where it makes sense.
Reply to @Kenster1_GlobalValue: I remember both you and Trev H on the M* forums touting the value of midcaps. Thanks for the good work you have been doing warning investors (novices, especially) not to performance chase.
Comments
But I have always liked the Midcap indexes because they can't get super top heavy --- if a company grows too large and growth-y then they have outgrown the midcap index and gets kicked-out. Some have cited this as an issue with the general market indexes but it's not a problem with the midcap indexes - but it was fallen on deaf ears and people just don't like indexes - it's been ingrained into people's head.
IJH and MDY have 10-year annualized returns just over 10% as well as Vanguard's Midcap Index fund. This has been a practically worry-free investment for me that I don't need to closely monitor - just rebalancing. Been great as a pretty tax-efficient investment for me as well.
There are also some midcap variants as well - for example:
RFG - annualized returns:
3-yrs: +21.30% | 5-yrs: +14.93%
How many investors jumped on CGMFX 5 years ago? 5-yrs = -5.03% annualized return. The 10 year returns of the Midcap indexes have handily beaten highly recommended funds including DODGX, TAVFX, Ariel Fund plus way too many other All-Star funds to mention which has turned investors into a game of fund musical chairs. Hell even on the old FundAlarm site - a multi-cap fund such as Muhlenkamp was touted and mentioned many times for years by some investors. The past 10 year performance has been a dud and the Midcap indexes have absolutely killed or knocked the snot out of MUHLX - a multicap fund that could invest in any stock it wanted.
It's not the be-all end-all investment but too bad so many investors had a dislike for the S&P500 index and concluded that all index investments were not good and could've used the Midcap indexes strategically. I use a combination of indexes and active funds where it makes sense.
Are you in FLPSX?