Top 10 Best performing Mutual Funds

Aditya Agrawal

Published in

Upwardly

7 min readFeb 23, 2018

Investing in Mutual Funds is with Upwardly’s recommended list of top 10 Mutual funds in India for 2018.

1. Reliance Small Cap Fund

This is one of the rare funds in the equity space which has beaten it’s benchmark as well as category over all time frames: one year, three years, five years or even seven years. Managing solid performance, even in bear phases, without leaning on large-caps is creditable. Over three and five years, the fund has been ahead of its benchmark by 6 to 13 percentage points. Compared to the category, it has managed 3 to 5 percentage point outperformance. A SIP of ₹5,000 p.m. in this fund started 5 years ago is worth ₹8.2 lakhs now.

2. Mirae Asset Emerging Bluechip Fund

This fund lives up to the ‘blue-chip’ tag in its name by scouting for quality names in the mid-cap space. It has outpaced both its benchmark and peers every year since its launch in 2011. The fund’s returns have stayed ahead of both benchmark and category returns on a one, three and five-year CAGR, unusual for the category. On three and five-year returns, it has outperformed its benchmark by 6 to 10 percentage points and the category by 6 to 7 percentage points. A SIP of ₹5,000 p.m. in this fund started 5 years ago is worth ₹7 lakhs now.

3. L&T Midcap Fund

This fund’s strategy is a blend of growth and value styles of investing. The focus is on owning fundamentally strong and scalable businesses with good management track record, at reasonable valuations. The fund’s asset allocation reveals a 25–30 per cent allocation to small-cap stocks, about 10–11 percentage points lower than the small-cap category, while mid-cap allocation is about 55 per cent, with the rest parked in large caps. This may result in a lower risk profile, while also moderating the returns from this fund. With 3-year and 5-year annualized returns of 17.74% and 28.22% respectively, the fund has outperformed its benchmark by 4 to 9 percentage points and peers by 4 to 5 percentage points. A SIP of ₹5,000 p.m. in this fund started 5 years ago is worth ₹6.6 lakhs now.

4. Franklin India Smaller Companies Fund

This fund has outperformed its benchmark without a break for the last nine years. In terms of investing style, it manages a balance between businesses with an acceptable level of quality, growth and sustainability. On a three and five-year basis, it has outperformed its benchmark by 2 to 10 percentage points but has been neck and neck with the category. It’s asset size rapidly increased to over Rs. 7200 cr in 2018. A SIP of ₹5,000 p.m. in this fund started 5 years ago is worth ₹6.8 lakhs now.

5. Aditya Birla Sun Life Small & Midcap Fund

This is a mid cap fund which means it would invest your money in stocks of medium and small cap companies. Mid cap and small cap companies tend to give kicker returns while large cap companies tend to be stable. It has 52.15% allocation to midcap companies and around 45.92% allocation to small cap companies. With 3-year and 5-year annualized returns of 19.22% and 27.21% respectively, the fund has outperformed its benchmark by 6 to 8 percentage points. A SIP of ₹5,000 p.m. in this fund started 5 years ago is worth ₹6.4 lakhs now.

6. Aditya Birla Sun Life Pure Value Fund

Its portfolio is made up of any company across the sectors with market value that is deemed to be less than its intrinsic value. The fund’s track record shows that it has beaten its benchmark in every one of those years. Trailing returns show large margins of outperformance, both of its benchmark and category, with three- and five-year returns 11–15 per cent ahead of the benchmark and 5–6 percentage points more than category. A SIP of ₹5,000 p.m. in this fund started 5 years ago is worth ₹6.8 lakhs now.

7. Canara Robeco Emerging Equities Fund

Consistency over time, rather than an ability to trounce the category, has been the hallmark of this fund. Its attempt is to identify companies which have the potential to become leaders of tomorrow in their respective sectors. It uses a growth-at-a-reasonable-price approach to pick companies which show consistent earnings growth higher than that of the market. On a three and five-year basis, it has outperformed its benchmark by 3 to 9 percentage points and category by 3 to 5 percentage points. A SIP of ₹5,000 p.m. in this fund started 5 years ago is worth ₹6.8 lakhs now.

8. HDFC Mid-Cap Opportunities Fund

This fund is a remarkably consistent performer in this category. The fund’s three-year return, at 14.95 per cent, is one percentage point ahead of the benchmark and 2 percentage points ahead its category returns. The five-year returns, at 25.40 per cent, are 6 percentage points higher than the benchmark returns and beat its peers’ returns by about 2 percentage points. What stands out in its annual returns is its ability to weather any kind of bear market. In 2008, 2011 and 2013, this was a rare mid-cap fund to contain losses to levels far lower than those of its benchmark. The popularity has resulted in a rapid growth of the fund’s size, from under Rs 10,000 crore in early 2016 to over Rs 20,000 crore now. This makes it by far the largest fund in this category. A SIP of ₹5,000 p.m. in this fund started 5 years ago is worth ₹6.1 lakhs now.

9. L&T India Value Fund

This fund has managed a very consistent show, outperforming the indices and peers every year except its debut one. It hunts for undervalued stocks in the market and is market-cap agnostic. Value opportunities are often identified in sectors and companies in special situations such as cyclically low earnings, turnaround and revival plays and so on. A high 45 to 55 per cent of the portfolio has been parked in large caps, 35 to 40 per cent in mid-caps and the rest in small-caps. The fund’s returns since launch are at 17.56 per cent. Based on three and five-year CAGR, it has outperformed its benchmark by 10 to 12 percentage points and peers by 2 to 3 percentage points. A SIP of ₹5,000 p.m. in this fund started 5 years ago is worth ₹6 lakhs now.

10. Principal Emerging Bluechip Fund

This fund has beaten its benchmark in six of the eight years since its launch. While other mid-cap funds have had trouble beating their benchmarks in the last one year, this fund has managed convincing outperformance. The fund’s returns are ahead of benchmark returns by 3 to 8 percentage points on a three and five year basis. It beat the category returns by 3 to 4 percentage points. This lead widened in the last one year. Its strong returns of 30 per cent since its launch make it a good choice. A SIP of ₹5,000 p.m. in this fund started 5 years ago is worth ₹6.3 lakhs now.