Mutual Funds
Mutual Funds pool money from multiple investors to create a diversified portfolio of stocks, bonds, and money market instruments. Managed by professionals, they offer diversification, reducing risk by spreading investments across various assets. Mutual funds provide flexibility and are accessible with small investment amounts, making them a popular choice for investors.
Top 10 Mutual Funds in India 2024
-
- ICICI Prudential Focused Bluechip Equity Fund
- Aditya Birla Sun Life Small & Midcap Fund
- Tata Equity PE Fund
- HDFC Monthly Income Plan – MTP
- L&T Tax Advantage Fund
- SBI Nifty Index Fund
- Kotak Corporate Bond Fund
- Canara Robeco Gilt PGS
- DSP BlackRock Balanced Fund
- Axis Liquid Fund
Top 10 Large Cap Equity Funds
|
Fund Name |
1-Year Returns |
3-Year Returns |
|
Nippon India Large Cap Fund |
34.57% |
25.34% |
|
Edelweiss Large Cap Fund |
28.39% |
18.69% |
|
HDFC Top 100 Fund |
28.04% |
21.24% |
|
Invesco India Largecap Fund |
27.5% |
17.22% |
|
SBI Bluechip Fund |
26.93% |
18.82% |
|
DSP Top 100 Equity Fund |
26.3% |
15.85% |
|
ICICI Prudential Bluechip Fund |
26.17% |
19.39% |
|
Bandhan Large Cap Fund |
25.58% |
15.95% |
|
Aditya Birla Sun Life Frontline Equity Fund |
23.73% |
17.24% |
|
Tata Large Cap Fund |
24.61% |
17.9% |
Top 10 Large and Mid Cap Equity Funds
Listed below are some of the top 10 performing large and mid cap equity funds as of Jan 2024:
|
Fund Name |
1-Year Returns |
3-Year Returns |
|
Nippon India Large Cap Fund |
34.57% |
25.34% |
|
Edelweiss Large Cap Fund |
28.39% |
18.69% |
|
HDFC Top 100 Fund |
28.04% |
21.24% |
|
Invesco India Largecap Fund |
27.5% |
17.22% |
|
SBI Bluechip Fund |
26.93% |
18.82% |
|
DSP Top 100 Equity Fund |
26.3% |
15.85% |
|
ICICI Prudential Bluechip Fund |
26.17% |
19.39% |
|
Bandhan Large Cap Fund |
25.58% |
15.95% |
|
Aditya Birla Sun Life Frontline Equity Fund |
23.73% |
17.24% |
|
Tata Large Cap Fund |
24.61% |
17.9% |
Top 10 Small Cap Equity Funds
|
Fund Name |
1-Year Returns |
3-Year Returns |
|
HDFC Small Cap Fund |
51.5% |
34.82% |
|
Nippon India Small Cap Fund |
7.28% |
36.5% |
|
Quant Small Cap Fund |
45.69% |
37.6% |
|
DSP Small Cap Fund |
45.38% |
29.74% |
|
Franklin India Smaller Companies Fund |
44.87% |
31.53% |
|
HSBC Small Cap Fund |
40.88% |
33.51% |
|
Aditya Birla Sun Life Small Cap Fund |
40.36% |
23.41% |
|
ICICI Prudential Smallcap Fund |
35.8% |
30.46% |
|
Sundaram Small Cap Fund |
39.34% |
28.87% |
|
Union Small Cap Fund |
36.46% |
27.16% |
Top 10 Tax Saving Mutual Funds in India 2024
|
Funds |
3-Year Returns |
5-Year Returns |
Risk |
|
Quant Tax Plan Direct-Growth |
35.23% |
27.64% |
Very High |
|
Bandhan Tax Advantage (ELSS) Fund |
29.33% |
18.79% |
Very High |
|
SBI Long Term Equity Fund Direct Plan-Growth |
26.24% |
17.69% |
Very High |
|
Bank of India Tax Advantage Fund |
23.28% |
21.44% |
Very High |
|
Canara Robeco Equity Tax Saver Fund – Direct Plan – Growth |
20.73% |
18.52% |
Very High |
|
Mahindra Manulife ELSS Fund |
24.22% |
16.63% |
Very High |
|
PGIM India ELSS Tax Saver Fund – Direct Plan – Growth |
23.89% |
17.19% |
Very High |
|
Kotak ELSS Tax Saver Fund – Direct Plan – Growth |
23.35% |
18.24% |
Very High |
|
Motilal Oswal ELSS Tax Saver Fund – Direct Plan – Growth |
25.22% |
17.37% |
Very High |
|
Franklin India Taxshield Fund – Direct – Growth |
26.14% |
16.10% |
Very High |
Top 10 Debt – Liquid Funds
|
Fund Name |
1-Year Returns |
3-Year Returns |
|
Aditya Birla Sun Life Liquid Fund |
7.08% |
5.39% |
|
PGIM India Liquid Fund |
7.02% |
5.35% |
|
Union Liquid Fund |
7.02% |
5.36% |
|
Axis Liquid Fund |
7.01% |
5.35% |
|
Edelweiss Liquid Fund |
7.0% |
5.35% |
|
UTI Liquid Cash Fund |
7.0% |
5.35% |
|
Canara Robeco Liquid Fund |
7.0% |
5.3% |
|
Nippon India Liquid Fund |
6.99% |
5.33% |
|
HSBC Liquid Fund |
6.99% |
5.34% |
|
Bank of India Liquid Fund |
6.99% |
5.35% |
Tax Calculation on Mutual Funds
Equity Mutual Funds:
-
- Short-Term Capital Gains (STCG): 15% if sold within 12 months.
- Long-Term Capital Gains (LTCG): 10% on gains exceeding ₹1 lakh per annum if held for more than 12 months.
Debt Mutual Funds:
-
- Short-Term Capital Gains (STCG): Taxed as per individual’s income tax slab if sold within 36 months.
- Long-Term Capital Gains (LTCG): 20% with indexation benefits if held for more than 36 months.
Calculate the Gains:
For Equity Mutual Funds:
STCG: Sale Price – Purchase Price = Short-term Capital Gain
LTCG: Sale Price – Purchase Price = Long-term Capital Gain (deduct ₹1 lakh exemption, if applicable)
For Debt Mutual Funds:
STCG: Sale Price – Purchase Price = Short-term Capital Gain
LTCG: Sale Price – Indexed Purchase Price = Long-term Capital Gain (apply indexation)
Apply the Tax Rate: Use the applicable tax rates to calculate the tax liability.
Example Calculations
Example 1: Equity Mutual Fund
- Purchase Price: ₹100,000
- Sale Price: ₹150,000
- Holding Period: 18 months (LTCG)
- LTCG Calculation: ₹150,000 – ₹100,000 = ₹50,000
- Tax Exemption: LTCG up to ₹1 lakh is exempt; ₹50,000 is within this limit, so no tax is payable.
Example 2: Debt Mutual Fund
- Purchase Price: ₹100,000
- Sale Price: ₹120,000
- Holding Period: 24 months (STCG)
- STCG Calculation: ₹120,000 – ₹100,000 = ₹20,000
- Tax Rate: 20%
- Tax Payable: 20% of ₹20,000 = ₹4,000
Example 3: Debt Mutual Fund with Indexation
- Purchase Price: ₹100,000
- Sale Price: ₹150,000
- Holding Period: 48 months (LTCG)
- Cost Inflation Index (CII): CII at purchase = 250, CII at sale = 300
- Indexed Purchase Price Calculation: ₹100,000 * (300 / 250) = ₹120,000
- LTCG Calculation: ₹150,000 – ₹120,000 = ₹30,000
- Tax Rate: 20%
- Tax Payable: 20% of ₹30,000 = ₹6,000
Investment Growth Over Time
Here’s a table showing how investments in mutual funds could potentially grow over different time periods (5 years, 10 years, 15 years, 20 years) with monthly investments of varying amounts (₹5,000, ₹10,000, ₹20,000, ₹50,000) and at different interest rates (8%, 10%, 12%, 15%, 18%):
|
Investment Amount (Monthly) |
Interest Rate |
5 Years |
10 Years |
15 Years |
20 Years |
|
₹5,000 |
8% |
₹4,24,422 |
₹11,44,320 |
₹24,01,883 |
₹47,79,269 |
|
|
10% |
₹4,60,871 |
₹14,68,081 |
₹35,19,570 |
₹75,34,044 |
|
|
12% |
₹5,00,760 |
₹18,85,055 |
₹50,27,134 |
₹1,06,24,603 |
|
|
15% |
₹5,66,797 |
₹27,52,267 |
₹73,40,064 |
₹1,65,02,049 |
|
|
18% |
₹6,42,825 |
₹40,65,341 |
₹1,11,26,432 |
₹2,68,12,171 |
|
Investment Amount (Monthly) |
Interest Rate |
5 Years |
10 Years |
15 Years |
20 Years |
|
₹10,000 |
8% |
₹8,48,843 |
₹22,88,641 |
₹48,03,765 |
₹95,58,538 |
|
|
10% |
₹9,21,742 |
₹29,36,161 |
₹70,39,141 |
₹1,50,68,089 |
|
|
12% |
₹10,01,519 |
₹37,70,110 |
₹1,00,54,267 |
₹2,12,49,206 |
|
|
15% |
₹11,33,594 |
₹55,04,533 |
₹1,46,80,127 |
₹3,30,04,098 |
|
|
18% |
₹12,85,650 |
₹81,30,682 |
₹2,22,52,864 |
₹5,36,24,341 |
|
Investment Amount (Monthly) |
Interest Rate |
5 Years |
10 Years |
15 Years |
20 Years |
|
₹20,000 |
8% |
₹16,97,687 |
₹45,77,282 |
₹96,07,530 |
₹1,91,17,075 |
|
|
10% |
₹18,43,483 |
₹58,72,321 |
₹1,40,78,281 |
₹3,01,36,177 |
|
|
12% |
₹20,03,037 |
₹75,40,219 |
₹2,01,08,534 |
₹4,24,98,411 |
|
|
15% |
₹22,67,188 |
₹1,10,09,067 |
₹2,93,60,253 |
₹6,60,08,195 |
|
|
18% |
₹25,71,300 |
₹1,62,61,363 |
₹4,45,05,729 |
₹10,72,48,682 |
|
Investment Amount (Monthly) |
Interest Rate |
5 Years |
10 Years |
15 Years |
20 Years |
|
₹50,000 |
8% |
₹42,44,219 |
₹1,14,43,203 |
₹2,40,18,826 |
₹4,77,92,690 |
|
|
10% |
₹46,08,713 |
₹1,46,80,806 |
₹3,51,95,705 |
₹7,53,40,440 |
|
|
12% |
₹50,07,603 |
₹1,88,50,551 |
₹5,02,71,338 |
₹10,62,46,031 |
|
|
15% |
₹56,67,969 |
₹2,75,22,668 |
₹7,34,00,638 |
₹16,50,20,486 |
|
|
18% |
₹64,28,246 |
₹4,06,53,407 |
₹11,12,64,321 |
₹26,81,21,712 |
Mutual Fund Benefits
Diversification: Spreads risk across a range of assets.
Professional Management: Expert fund managers make informed investment decisions.
Affordability: Low entry points for investors.
Liquidity: Easy to buy or sell shares on any business day.
Variety of Funds: Options like equity, debt, hybrid, index, and sectoral funds.
Tax Efficiency: Certain funds offer tax benefits and efficient taxation.
Transparency: Regular updates and strict regulation ensure investor protection.
Convenience: Easy investment and withdrawal options, including SIPs and SWPs.
Types of Mutual Funds
Mutual funds pool money from multiple investors to invest in various securities, managed by professionals. Here’s a breakdown of the main types:
Based on Structure:
- Open-Ended Funds: Allow buying and selling of units anytime with no fixed maturity. NAV is calculated daily.
- Closed-Ended Funds: Have a fixed maturity period. Units are purchased during the initial offer and traded on stock exchanges afterward.
- Interval Funds: Offer a mix of features from open and closed-ended funds, open for transactions at specific intervals.
Based on Asset Class:
- Equity Funds: Invest in stocks for capital appreciation. Includes large-cap, mid-cap, small-cap, sectoral, and thematic funds.
- Debt Funds: Invest in fixed-income securities for stable returns. Includes liquid, short-term, long-term, corporate bond, and gilt funds.
- Hybrid Funds: Combine equity and debt for balanced risk and return. Includes balanced, aggressive hybrid, and conservative hybrid funds.
- Money Market Funds: Invest in short-term, high-quality debt for liquidity and modest returns.
Based on Investment Objectives:
- Growth Funds: Focus on capital appreciation with a high-risk tolerance and long-term horizon.
- Income Funds: Aim for regular income through dividends and interest, suitable for moderate risk.
- Index Funds: Track specific market indices, offering passive investment strategies.
- Tax-Saving Funds (ELSS): Invest in equity with tax benefits under Section 80C and a 3-year lock-in period.
- Balanced Advantage Funds: Adjust equity and debt allocation based on market conditions for optimized returns.
- Sector and Thematic Funds: Focus on specific sectors or themes, suitable for high-risk tolerance.
Based on Risk Profile:
- High-Risk Funds: Typically equity or sector/thematic funds with high return potential but higher risk.
- Medium-Risk Funds: Hybrid and balanced funds, balancing risk and return.
- Low-Risk Funds: Debt and money market funds, focusing on capital preservation and stable returns.