10 Best Mutual Funds To Invest

10 Best Mutual Funds To Invest

Mutual Fund Meanng 

 A mutual fund is a form of financial vehicle that invests in securities such as stocks, bonds, money market instruments, and other assets by pooling money from multiple participants. Professional money managers manage mutual funds, allocating assets and attempting to generate capital gains or income for the fund’s investors. The portfolio of a mutual fund is constructed and managed to meet the investment objectives indicated in the prospectus.

Investing in a mutual fund is not the same as investing in individual stocks. Unlike stock, mutual fund shares do not provide voting rights to their owners. Instead of a single holding, a mutual fund share reflects investments in a variety of stocks (or other securities).

List Of Mutual Funds To Invest

Mutual Fund To Invest CategoryPersonal FN Rating1 Year
%
3 Years
%
5 Years
%
Since Inception
%
Canara Robeco Bluechip Equity FundLarge Cap547.1517.1416.6313.35
Mirae Asset Large Cap FundLarge Cap 548.0014.6415.8316.20
Mirae Asset Emerging Bluechip FundLarge &
Mid Cap
567.9622.3621.4522.25
Canara Robeco Emerging Equity Fund Large &
Mid Cap
461.2516.2018.3118.06
Parag Parikh Flexi Cap FundFlexi Cap 555.1722.2620.7120.44
UTI Flexi Cap FundFlexi Cap 466.3418.8217.6316.40
Axis Midcap FundMid Cap 562.3321.1820.0719.47
Kotak Emerging Equity Fund Mid Cap 479.3819.7117.7314.28
SBI Small Cap FundSmall-Cap 484.5220.7522.4420.89
Kotak Small Cap FundSmall-Cap 4116.8825.9120.2917.93

Mutual Funds To Invest

Mutual Fund To Long-Term Invest

Large Cap Category

Canara Robeco Bluechip Equity Fund Canara Robeco Bluechip Equity Fund is one of the top long-term mutual funds to invest in. In the previous five years, it has achieved a CAGR of 16.63 percent (as of 5th August 2021). This outperforms the S&P BSE 100-TRI, which has a five-year CAGR of 14.76 percent (as of 5th August 2021).

Canara Robeco Bluechip Equity Fund, on the other hand, barely has Rs 3,308 crores in assets under management (AUM) (as of 5th August 2021). This is little when compared to Axis Bluechip Fund’s AUM of Rs 28,247 crores (as of 5th August 2021). Despite this, the fund has outperformed its peers in both the short and long run.

Over its benchmark, the fund has earned an alpha of 7.5 percent (between 14th January 2020 and 23rd March 2020). It also offers one of the most favorable risk-to-reward ratios in the category. It has a standard deviation of 19.13%. (as of 5th August 2021). As of August 5, 2021, this is lower than the standard deviation of its benchmark (21.89 percent) and the category average (21.33 percent).

Mirae Asset Large Cap Fund Mirae Asset Large Cap Fund is a market leader and the finest mutual fund to invest in for the long term. It was first released in 2008 and has since been shown to be a reliable performer. In the previous five years, it has achieved a CAGR of 15.83 percent (as of 5th August 2021). It has outperformed its benchmark, the Nifty 100-TRI, by 1.03 percent (between 23rd March 2020 to 22nd June 2021).

According to the portfolio as of June 30, 2021, the fund is a genuine large-cap with a 21.88 percent exposure to banks and a 15.97 percent exposure to IT – Software. Its volatility has been almost in line with the benchmark, with a Standard Deviation of 21.29 percent (as of August 5, 2021). Furthermore, as of August 5, 2021, the fund’s Sharpe (0.53 percent) and Sortino Ratio (0.58 percent) are among the best in the category, above its benchmark and category average.

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Large & Mid CapĀ 

Mid-cap equities are rarely invested in by large-cap mutual funds. But what if you also want to be exposed to aggressive mid-caps?

A big & mid-cap fund, as defined by SEBI, must invest a minimum of 35 percent of its assets in large-cap stocks and equity-related securities, while also holding a minimum of 35 percent of its assets in mid-cap stocks (i.e. companies from 101st to 250th on full market capitalization basis). The rest is invested in debt and money market securities.

This strategy allows investors to benefit from both the rise in mid-cap companies and the stability of large-cap equities.

1) Mirae Asset Emerging Bluechip Fund, and 2) Canara Robeco Emerging Equities Fund are the top two best mutual funds to invest in for long-term investments in the Large & Mid-cap category.

Large & Mid Cap

Mirae Asset Emerging Bluechip FundThis is one of the best big and mid-cap funds available. It has earned a 67.96 percent one-year return (as of 5th August 2021). Its latest five-year compounded annualized return was an eye-catching 21.45%!

At 0.82 percent, the fund has one of the strongest Sharpe ratios in the industry (as of 5th August 2021). It’s one of the few funds that can perform well in both bull and downturn markets. The fund is renowned for having good portfolio characteristics and is appropriate if you’re ready to accept a little higher risk with mid-caps and have a 5-year investment horizon.

Canara Robeco Emerging Equities Fund Canara Robeco Emerging Equities Fund is a well-balanced Large and Midcap fund with a 16-year track record of performance. It has earned a compounded annualized return of 18.06 percent from its start in March 2005 (as of 5th August 2021), and a return of 61.25 percent during the last year (as of 5th August 2021).

The fund’s price-to-equity ratio (P/E) of 35.37x indicates that it is pursuing a growth strategy (as per the fund factsheet). The fund has a well-balanced portfolio of more than 50 equities. Financial sector stocks account for the majority of the market (28.27 percent). According to the portfolio as of June 30, 2021, the fund invests 38.02 percent in large-cap equities, 33.30 percent in mid-cap companies, and 6.56 percent in small-cap stocks.

Flexi Cap Category

The Securities and Exchange Board of India (SEBI) has created a new category (SEBI). Flexi cap funds, unlike multi-cap funds, do not have a defined investment mandate to invest in the market capitalization sector. Flexi cap funds, on the other hand, offer the ability to invest dynamically among big, mid, and small-size firms.

Flexi-cap funds are positioned higher on the risk-reward spectrum than big-cap funds and large & mid-cap funds, as predicted. As a result, if you are ready to accept the high risk and want to benefit from capital appreciation across market capitalization sectors on a dynamic basis, you might select a Flexi-cap fund, as long as you have a 5-year investment horizon.

1 Parag Parikh Flexi Cap Fund and 2 UTI Flexi Cap Fund are the top two finest Flexi cap mutual funds to invest in for long-term investing.

Parag Parikh Flexi Cap Fund– Due of its value investing style approach – shown by the portfolio P/E of 26.12x – and combination of domestic and overseas stocks, the Parag Parikh Flexi Cap Fund makes it to our best mutual funds list to invest in for long term investments. It invests one-third of its assets in international stocks, such as Alphabet, Amazon, Facebook, Microsoft, and others. In the last year, the fund has earned an outstanding 55.17 percent return (as of 5th August 2021).

Despite the significant volatility in the equity markets over the previous few years, the Parag Parikh Flexi Cap Fund has consistently performed in the top quartile. The fund has outperformed both its benchmark and the majority of its rivals. Furthermore, the fund’s outperformance was consistent across bull and down market periods.

UTI Flexi Cap Fund In accordance with the shift in the fund’s categorization to the Flexi cap category, UTI Equity Fund, one of the oldest schemes in the Indian mutual fund market (established in 1992), was renamed UTI Flexi Cap Fund (UFCF). Due to its outstanding track record in both bull and downturn markets, it is one of the finest mutual funds to invest in for long-term investing.

In the last year, it has earned a return of 66.34 percent (as of 5th August 2021). Against its benchmark index, the Nifty 500 TRI, the fund produced an alpha of 2.98 percent (from March 23, 2020, to May 31, 2021). Furthermore, during the recent market crisis, UTI Flexi Cap Fund proved its capacity to minimize the downside and participate in the recovery phase.

According to the portfolio as of June 30, 2021, the fund invests 42.10 percent in large-cap equities, 33.25 percent in mid-cap companies, and 9.43 percent in small-cap stocks. It has major stakes in financials, information technology, and the healthcare industry, to name a few.

If you are a highly aggressive investor, here is a list of the top mid-cap and small-cap mutual funds to invest in for long-term investing.

Mid-Cap Category

Mid-cap funds must invest in equities ranked 101st to 250th in terms of market capitalization, according to regulatory requirements. These stocks are smaller than large caps and belong to expanding mid-sized businesses. As a result, the investment risk is very high. Mid-cap funds, on the other hand, have the potential to produce considerable wealth.

Mid-cap funds beat pure big-caps and even large & mid-cap funds by a substantial margin during bull markets. In contrast, they tend to plummet more during bad markets.

Mid-caps have outperformed large-caps by a significant margin throughout the recent bull phase. Mid-cap funds have the potential to outperform large-cap funds in the long run.

1 Axis Midcap Fund and 2 Kotak Emerging Equity Fund are the top two best midcap mutual funds to invest in for long-term investing.

Axis Midcap Fund For long-term investing, this is one of the top midcap funds to invest in. Axis Midcap Fund invests in high-quality growth-oriented midcap firms, which have reaped attractive returns for its investors over time. The fund uses a bottom-up investment methodology and seeks a growth strategy.

It has steadily expanded its stock holdings to approximately 60 from 35-50 previously, presumably to accommodate its rising asset size. As of June 30, 2021, the Axis Midcap Fund’s portfolio consisted of 27.68 percent large-cap equities, 57.84 percent mid-cap companies, and 11.93 percent small-cap stocks. In terms of sector allocation, the fund is significantly invested in the financial (17.87%) and information technology (11.91%) sectors.

In the last year, the Axis Midcap Fund has earned a 62.33 percent return (as of 5th August 2021). It has had a compounded annualized return of 19.47 percent since inception, making it one of the top mutual funds to invest in for long-term investing (as of 5th August 2021).

Kotak Emerging Equity Fund Over the previous few years, this fund has risen to become one of the best performers in the category. The fund was established in 2007 and has total assets under management (AUM) of Rs 14,133 crore (as of 5th August 2021).

The Kotak Emerging Equity Fund has gone through a number of market stages and cycles and has done a good job of riding through the highs and lows in most of them.

According to the portfolio as of June 30, 2021, the fund invests in 66 equities, with 5.56 percent in large-cap stocks, 62.36 percent in mid-cap stocks, and 24.83 percent in small-cap stocks. It has a well-diversified portfolio that includes, among other things, healthcare, construction, engineering, financials, and chemicals.

To realize the full potential of the equities, the fund employs a buy-and-hold investing approach. This allows it to profit from midcap firms’ long-term growth. The fund has produced a 79.38 percent one-year return (as of 5th August 2021). Since its debut, it has generated a compounded annualized return of 14.28 percent (as of 5th August 2021). This outstanding return makes it one of the finest long-term investment funds.

Small Cap Category

According to market capitalization, small-cap mutual funds invest in equities of businesses ranked 251 and up. Small-cap equities are smaller than mid-cap firms and are listed below them. Furthermore, as compared to big and mid-cap equities, small-cap stocks often have lower trading volumes. As a result, the risk of investing in small-cap stocks is higher.

Given these qualities, a small-cap fund may have a proclivity for swinging from exhilarating highs to perilous lows. As a result, a small-cap fund should only be considered if you are willing to accept extremely high volatility or risk.

SBI Small Cap Fund and Kotak Small Cap Fund are the two greatest small-cap mutual funds to invest in for the long term.

SBI Small Cap Fund This small-cap mutual fund, which was launched in September 2009, now manages a corpus of about Rs 9,000 crore. This fund employs a bottom-up investment method to find high-growth businesses for investment, combining growth and value investing.

According to the portfolio as of June 30, 2021, the fund has a diverse portfolio of 50 equities, with 73.96 percent in small-cap stocks, 9.07 percent in midcap stocks, and 13.62 percent in other stocks. The SBI Small Cap Fund does not invest in large-cap stocks. As a result, the fund is extremely risky. Chemicals, consumer durables, cement, construction, engineering, consumer non-durables, and other industries are all represented in the fund.

SBI Small Cap Fund has generously rewarded its investors. It has earned an annualized return of 20.89 percent since inception, with an annualized return of 84.52 percent in the previous year (as of 5th August 2021). (as of 5th August 2021).

Kotak Small Cap Fund This plan, which was launched in February 2005 and manages approximately Rs 4,500 crore in assets, is another good small-cap fund. It invests in a hybrid strategy with a concentration on high-growth stocks. It typically invests in companies with proven products/services, above-average earnings growth, and the potential to sustain that growth, which appears undervalued compared to their growth prospects, and/or companies in the early and more dynamic stage of the life cycle but are no longer considered new or emerging.

For stability, the Kotak Small Cap Fund now owns 67 companies, with 67.73 percent in small-caps, 12.91 percent in mid-caps, and 1.76 percent in large-caps. According to the portfolio as of June 30, 2021, the fund’s sector composition is biassed toward consumer goods (22.59 percent), industrial manufacturing (14.82 percent), chemicals (8.68 percent), construction (6.67 percent), and information technology (6.63 percent).

Kotak Small Cap Fund had a one-year return of 116.88 percent (as of August 5, 2021) and a compounded annualized return of 17.93 percent since its start. The Kotak Small Cap Fund is one of the greatest long-term mutual funds to invest in.

Mid-Cap Category

Benifit Of Mutual Fund To Invest

  • Increased Profits
  • Absorption of Risk
  • Benefit from Taxes
  • Compounding’s Power
  • Less reliance on a superstar fund manager
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I hope you enjoyed and learned a lot from this essay. Thank you very lot for your help. If you have any questions about this post, please leave a comment. I, Aarti Devatwal, would want to express my sincere gratitude for taking the time to read this essay. I hope you learned a lot from this.

WHAT is a mutual fund?

A mutual fund is a form of financial vehicle that invests in securities such as stocks, bonds, money market instruments, and other assets by pooling money from multiple participants.

Explain the benefit of mutual funds to invest in?

Increased Profits Absorption of Risk-Benefit from Taxes Compounding’s Power
Less reliance on a superstar fund manager

Which mutual fund category is better for long-term investing?

There are more than 29 different types of mutual funds in India. But for long-term wealth creation, equity mutual funds are appropriate and potent.
So, if you are an aggressive investor, then consider investing in the appropriate sub-categories of equity-oriented mutual funds.

What are the tax implications of long-term mutual funds?

Long-term is defined as a holding duration of more than 12 months in the case of equity funds. When you sell your mutual funds for a profit after a year, capital gains over Rs 1 lakh are taxed at a flat 10% rate.

What are the finest long-term midcap mutual funds to invest in?

Midcap mutual funds are appropriate for highly active investors with a 5- to 7-year investment horizon and a high-risk tolerance. The finest midcap funds to invest in for the long term are Axis Midcap Fund and Kotak Emerging Equities Fund.

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