During the early-year run up, mid-cap stocks have actually led the pack. Investors who bought up shares of the iShares S&P Mid-Cap 400 Index Fund (IJH) have enjoyed nearly 15% gains.
In addition to this upside action, the fund also managed to hold up better in the face of last week's shakeup. Although it suffered a downturn as EU debt fears and China growth concerns dominated headlines, IJH was quick to rebound. It has since pushed higher, locking in new 2012 highs.
Small-cap stocks may seem like an obvious choice during periods of strong market action. However, as we have seen throughout the opening quarter of the year, they are not always the best. In this current market environment, mid-caps provide the best mixture of upside potential and safety. Investors considering a foray into risk should have a fund like IJH on the radar when planning their approach.-- Written by Don Dion in Williamstown, Mass.