More and more people are investing in mutual funds (MFs) because they can help those with little funds create a portfolio. The most recommended way to start investing is through a

Systematic Investment Plan (SIP). Depending on how comfortable you are, you can invest in one of these best mutual funds in India on a weekly, monthly, quarterly, or biannual basis. Your return increases annually along with the investment amount when you invest in a mutual fund through a systematic investment plan (SIP). This is how compounding works to an investor’s advantage to help him accumulate wealth and become wealthy.

Best Mutual Fund In India Over The Past Five Years

1. SBI Small Cap Fund Growth

By August 16, 2021, the AUM of the SBI small cap fund was INR 9,620.21 cr, with an expense ratio of 0.84% and an NAV of INR 102.68. The stock selection strategy incorporates both growth and value investment strategies. The fund offers a 5-year CAGR of 23.31% to provide investors with opportunities for long-term wealth creation.

2. Parag Parikh Direct-Growth Flexi-Cap Fund

With an AUM of INR 13,186.70 cr and a lower cost ratio of 0.89%, the Prime India mid-cap opportunities fund is classified as the best mutual fund in India. The fund requires a minimum lump sum investment of INR 5000 and has an exit load of 1% if redeemed between 366-730 days and 2% if redeemed within 365 days. The fund offers a 5-year CAGR of 21.51%, making it suitable for investors looking to invest for three to four years. It makes its primary investments in stock and equity-related assets to produce long-term capital appreciation.

3. Mirae Mutual Funds. Axis Bluechip Fund Growth

With an AUM of INR 29,160.6 crore, the Axis Bluechip Fund was introduced by Axis Mutual Fund and invests in blue-chip stocks, or the stocks of large, well-established corporations. Despite being categorized as high-risk, they possess adequate liquidity and exhibit lower volatility in comparison to mid-cap or small-cap companies.

4. Direct-Growth Canara Robeco BlueChip Equity Fund

Canara Robeco Mutual Fund has been offering an equity mutual fund scheme strategy since 2013. The strategy’s main goal is to encourage capital appreciation by investing primarily in companies with high market capitalizations. With an Asset Under Management (AUM) of INR 3,691.25 Cr at present, the fund is known as the best mutual fund in India.

5. Small-Cap Nippon India Fund

With a minimum SIP contribution of INR 100 and a maximum lump sum investment of INR 5000, the Nippon India Small-cap Fund—which focuses on small-cap companies across sectors—carries an extraordinarily high-risk profile. It also has an exit cost of 1% if the fund is redeemed within a month. The fund went public in 2013 and is suitable for investors who are ready to take on more risk appetite in exchange for higher returns. However, because of the risk involved, investors should be ready to lose some money. Over five years, the portfolio yields a 23.61% CAGR.

6. Axis Direct-Plan-Growth Mid-Cap

With an AUM of INR 13,834.27 cr, the firms chosen for this fund’s portfolio have excellent growth potential to meet the investing goal of quickly generating wealth. Despite its relatively high risk, the Axis Midcap Fund is suitable for investors looking for the best mutual fund in India. However, because this is a high-risk fund, investors should be prepared for the possibility of slight losses on their investments. The investment delivers a 5-year CAGR of 21.13%, making it ideal for long-term goals like retirement, education, etc.

7. The Mid-Cap Opportunities Fund of PGIM India

With a minimum SIP amount of INR 1000 and an expense ratio of 0.37%, the PGIM India Midcap Opportunities fund has an AUM of INR 2383.38 cr. Although INR 5000 is the minimum lump sum payment required, units representing more than 10% of the investment will incur a 0.5% redemption fee if they are redeemed within 90 days. With a 5-year CAGR of 21.23%, the PGIM India Midcap Opportunities Fund is categorized as having a very high risk. It is recommended for investors expecting substantial profits over a minimum of three to four years.

10. Birla Aditya Fund for Sun Life Digital India

The fund is a sector equity fund that made its debut on January 15, 2000. Since its launch, this high-risk investment vehicle has produced an 11.4% CAGR/annualized return. The returns for 2022 were -21.6%, 2021 was 70.5%, and 2020 was 59%. To achieve long-term capital growth, this multisector open-ended growth strategy concentrates on investing in technology and technology-dependent businesses, hardware, peripherals, components, software, telecom, media, internet, and e-commerce, as well as other technology-enabled firms. The secondary objectives are dividend distribution and income generation.

Name	5-year return (%)	Avg Return (%)	AUM (Crs)	Doubled
Mirae Asset Tax Saver Fund Direct-Growth	25.48	18.39	₹14,020.27	Every 3 years
Axis Bluechip Fund Direct-Growth	12.21	14.19	₹ 33,584 1	Every 6 years
Canara Robeco BlueChip Equity Fund Direct-Growth	24.91	14.02	₹ 8,642	Every 3 years
Aditya Birla Sun Life Digital India Fund	18.36	21.69	₹ 3,334	Every 3 years
SBI Small Cap Fund Direct-Growth	14.62	13.97	₹ 15,292	Every 3 years
Parag Parikh Flexi-Cap Fund Direct-Growth	16.48	11.78	₹ 29,345	Every 3 years
Nippon India Small-Cap Fund	15.78	13.73	₹ 23,756	Every 3 years
Axis Mid-Cap Direct-Plan-Growth	15.91	12.81	₹ 18,756	Every 3 years
PGIM India Mid-Cap Opportunities Fund	18.33	12.81	₹ 7,617	Every 3 years

Factors to Consider Before Purchasing the Top-Performing Mutual Funds

● The Risks and Returns of Different Mutual Funds Vary

Recall that different mutual fund kinds have varying risk profiles and potential rewards. Since not all mutual funds are created equal, it can be challenging to determine how hazardous they are.

● Decide on what’s best for you.

Invest your money in a mutual fund that keeps onto investments for a while if you plan to make money over an extended period—more than a year. Opt for short-term options if you would rather receive money more frequently.

● Consider This: Fund vs. Category

Investing in well-liked or highly-rated online funds is common. However, it’s more crucial to choose a type that works for you. Once the type is known, you can select the particular funds.

● Seek for Consistent Performers

Examine the mutual fund’s performance historically, not just lately. Check if it has a consistent track record throughout one to five years or if it fluctuates a lot.

● Take care not to overinvest!

Diversifying your investments can help reduce risk, but don’t go overboard. Being overly diversified won’t increase your income.

Wrapping Up

Start small if you’re new to investing. Rushing could result in equivalent funds that don’t contribute to your income growth, Typically, while discussing the earnings of a mutual fund, one will provide an annual average. It does not, however, produce the same amount each year. It might not matter all that much in certain years, but it might matter a lot in others. Prepare yourself for it.

Since there is no middleman, such as an agent or broker, to pay, direct plans are typically less expensive than ordinary ones. As a result, a larger portion of your funds are invested, potentially increasing your earnings.

FAQs

1. What affects returns on mutual funds?

The performance of the underlying assets, management fees, and the overall performance of the market all affect returns.

2. How often should I check my investments in mutual funds?

Keep a regular eye on your money, but refrain from acting on impulse. Annual or semi-annual assessments are typical.

3. What distinguishes active funds from passive funds?

Passive funds follow market indexes, whereas active funds are managed by experts who seek to beat the market.

4. Is it possible for me to withdraw my money before the deadline?

Redeems are generally permitted for mutual funds; however, there may be costs or penalties for early withdrawals.

5. Are these top-performing funds subject to fees?

Yes, loads and cost ratios are among the fees associated with mutual funds. Examine these expenses while selecting a fund.