The concept of a mutual fund is getting together a group of investors to invest a certain amount of money. Here, the investor is given a certain amount of mutual fund units that indicate their contribution to the fund. The investment may be in the form of bonds, stocks or any other asset. The net asset value (also known as NAV) is the unit of purchase and redemption of the invested sum. The investment of the money in a mutual fund’s NAV is carried out at the investor’s convenience. Now the interesting aspect here is the fact that NAV is dependent on the underlying assets of the fund and fluctuates daily.
Investing in mutual funds gives you access to diverse portfolios at a relatively small amount of investment. You also gain easy access to professional fund management. It is understandable that, as an investor, you would want to take up a mutual fund that gives the best returns. Now, while your investment horizon, risk profile and life goals all have a role to play, investing in well-performing mutual funds gives you an edge. Read on to know about the current best performing mutual funds in India.
Axis Long Term Equity Fund
This is one of the most consistent names in the listing of the best performing mutual funds in India. In the last financial year, the fund gave a whopping 13.93% return on a 5-year investment. The fund has 68% of its assets in large caps and a mere 1.6% in small caps. The values are enough to ensure investors of a certain level of monetary stability in an ever-volatile market. It is the consistent performance of this tax-saving scheme that is responsible for its magnanimous size and popularity.
Franklin India Prima Fund
One of the older players in the field, this fund has a unique asset allocation. Unlike most other plans in this list, which allocate the major chunk of the available money to financial stocks, here the focus is on the automobile, engineering, chemical, and energy stocks. From a monetary aspect, this has worked in favour of investors. One of the most prominent names in the mid-cap category, Franklin Prima has delivered returns in a vigorous rate in the past few years and the same is expected to continue in 2019. At the moment, its 5-year CAGR stands at a decent12.84%
Kotak Standard Multicap Fund
The returns on this fund have been great with 13.93% being the 5-year CAGR value. With 55 stocks, this fund is one of the most diversified ones in India. 76% of the assets are in the large-cap, 23% in the mid-cap and only 1% in the small-cap market. Since its inception in September 2009, this fund has been the preferred choice of the relatively cautious lot of equity investors. Going through the ups and downs of the share market, the fund has delivered well over the last decade and the same is expected to continue in the coming year.
HDFC Small Cap Fund
In the last financial year, HDFC Small Cap Fund has invested 62% of its funds in small-cap companies and 32% in mid-cap companies. This left only 6% large-cap exposure. As a result, the investors were able to get good gains on this. The 5-year CAGR value stood at an amazing 12.85%. As of 2019, the fund does not hold a major cash component. From this, we can infer that its growth in the small and mid-cap space will accelerate in the coming months and it is a good option for putting your hard-earned money.
Axis Bluechip Fund
This is one rare mutual fund where the 3-year return stands at a higher value than that of a 5-year return (the respective figures are 13.64% and 12.23%). Considering the market situation, we can expect similar returns in 2019 as well. Although the fund owns only 23 stocks at the moment, each of those is well-chosen in a manner such that investors get good returns out of it. It is to be noted that being a large-cap fund, it invests 80% of its funds in India’s largest companies.
Now that you know which are the 5 best performing mutual funds in India of 2019, you should sit back and figure out which works best for you. Do not rely on the CAGR values alone and access whether you want a small, medium or large-cap scheme. For example, while small-cap mutual funds are riskier, they are eligible for giving you higher returns. Selecting the type of mutual funds (like equity or debt-based) is equally important. If your goals are of short term, debt mutual funds will give you better returns. We hope the fact that the best performing mutual funds in this list are from different categories will aid you in deciding your investments.