Former small caps that have grown up, they balance spunk and safety
A useful way to think about mid-cap stocks is to view them as former smallcap stocks that, propelled by strong and steady growth and often blessed with positive and stable earnings and cash flows, have pulled ahead of their peers.
Today, as investors increasingly fixate on the quality of earnings and the reality of growth prospects, every mutual fund investor should own at least one mid-cap fund. One outstanding choice, which joins FundFolio this issue, is T. Rowe Price Mid-Cap Value fund (TRMCX). Belonging to the respected Baltimore-based fund family T. Rowe Price—which has remained untainted by any hint of the mutual fund scandal—this five-star mid-cap fund is one of the best in its category. It invests in shares of undervalued medium-sized companies and currently is overweighted in several sectors, including media, business services, telecommunications, and utilities. Throughout its eight-year history it has been a stellar performer, in the top 11 percent for the past five-year period, the top 9 percent for the three-year period, and the top 10 percent for the past year.
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