2017 RANKING & REVIEWS
TOP RANKING BEST MUTUAL FUNDS IN INDIA
Finding the Best Mutual Funds in India
Investing in mutual funds in India is a way to mitigate the risk of the stock market. India mutual funds work like mutual funds anywhere else. The money or funds of several participants are pooled and then invested into a selection of securities including stocks and debt instruments.
This collection of funds that make up some of the top mutual funds in India are referred to as Assets Under Management (AUM). The underlying investments of these top performing mutual funds in India are referred to as the portfolio, and those who participate in these mutual funds in India buy a portion of this portfolio. These portions are known as units.
Award Emblem: Best Mutual Funds in India for Long-Term Investing
When people are investing in the stock market, they choose low-risk, low-reward securities for short-term investment goals.
This means they will need the money sooner rather than later. For long-term investment goals, investors are more comfortable investing their money in riskier securities for the possibility of high rewards and the time to bounce back if the market does not work in their favor.
Investors can find mutual funds in India with varying risk levels; there are some India mutual funds that invest primarily in equity and there are debt mutual funds India that invest in fixed income securities.
This article on the best mutual funds to invest in India will provide some tips on how to analyze the best performing mutual funds in India and provide a list of the top five mutual funds in India for long-term investments.
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AdvisoryHQ’s List of Top 5 Mutual Funds in India
List is sorted alphabetically (click any of the India mutual funds names below to go directly to the detailed review section for those mutual funds in India):
- Birla Sun Life Frontline Equity (G) Review
- DSB BlackRock Focus 25 Fund (G) Review
- ICICI Prudential Top 100 Fund (G) Review
- Kotak Select Focus Fund – Regular (G) Review
- SBI Blue Chip Fund (G) Review
Top 5 Best Mutual Funds in India | Brief Comparison
Top Mutual | CRISIL Ranking | Exit | Highest | Highest |
| Birla Sun Life Frontline Equity (G) Review | 1 (Large Cap) | 1.00% | Banking/ | Equity (93.09%) |
| DSB BlackRock Focus 25 Fund (G) Review | 2 (Large Cap) | 1.00% | Banking/ | Equity (98.11%) |
| ICICI Prudential Top 100 Fund (G) Review | 2 (Large Cap) | 1.00% | Banking/ | Equity (96.68%) |
| Kotak Select Focus Fund – Regular (G) Review | 1 (Large Cap) | 1.00% | Banking/ | Equity (90.92%) |
| SBI Blue Chip Fund (G) Review | 2 (Large Cap) | 1.00% | Banking/ | Equity (98.11%) |
Table: Top 5 Mutual Funds in India | Above list is sorted alphabetically
Understanding Mutual Funds in India
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What is a mutual fund in India? | What is the difference between open-ended funds and closed-ended funds?
Open-ended India mutual funds allow investors to enter and exit the fund as they please. Units are bought and sold continuously. This means that after the initial offering, participation in an open-ended fund is still a possibility for investors who did not get in on the action from the outset. And those who did purchase units during the initial offering and feel they did not find the best India mutual funds are not obligated to stay the course of the scheme. They can sell their units and withdraw from the investment scheme.
Alternatively, closed-ended mutual funds in India do not provide investors this same flexibility. Whereas the unit capital of open-ended funds fluctuates, that of closed-ended funds does not. Those who purchase units during the initial offering are locked in for the duration of the scheme, and those who did not buy any units during that period are out of luck.
So, whether you’re trying to get out of what you thought would be the best mutual funds in India or you’re trying to get into what is starting to look like the top mutual funds in India, you’re stuck. However, the closed-ended top performing mutual funds in India are usually listed on stock exchanges to provide some leeway for investors who want out after investing in the best performing mutual funds in India.
What is a mutual fund in India? | Understanding benchmarks
Investors need a way to check on their mutual fund scheme and ensure they have chosen one of the best mutual funds in India. A benchmark is a standard against which something else is measured. Mutual funds like the best mutual funds to invest in India use other indices as their benchmarks to evaluate their performance. In India, the NIFTY 50 is the stock market index for the country’s equity market. It, in turn, serves as the benchmark for some of the top mutual funds in India.
What is a mutual fund in India? | Exit loads and entry loads, explained
Loads are a workaround term for the sales fees associated with some of the best mutual funds to invest in India. While most investors would prefer no-load fees (and they do exist), there are many top performing mutual funds in India that come with either an entry load or an exit load. The difference between an entry load and an exit load for the best performing mutual funds in India is simply timing. Entry loads on mutual funds in India or debt mutual funds in India are charged when you enter a fund, and an exit load is charged when you exit a fund or transfer your units to another investor.
What is CRISIL? | Ranking the Top 5 Mutual Funds in India
CRISIL is a global analytics company that provides rankings and risk analysis for investors, businesses, and consumers. It comes up a lot in this article of the top five mutual funds in India since CRISIL provides rankings on the best mutual funds in India for long term and short term. Formally known as Credit Rating Information Services of India Limited, CRISIL’s majority shareholder is the popularly known financial services company, Standard & Poor’s.
What are large cap funds, mid cap funds, and small cap funds? | Choosing the best mutual funds in India for long-term investing
While conducting your research to find the best India mutual funds, whether they are equity mutual funds or debt mutual funds from India, you will likely hear terms like large cap, mid cap, and small cap being thrown around. These descriptors have nothing to do with accessories. Instead, these terms refer to the market capitalization of a particular fund, and they can be very helpful when looking for the best mutual funds in India for long-term investments.
What is market capitalization? Market capitalization is the valuation of a company based on its share price, which can vary, and the number of shares outstanding. This is applied to mutual funds when it comes to determining the total value of the fund in regard to the number of units outstanding. This number is an important consideration for those seeking the best India mutual funds.
Typically, the larger the capitalization, the less risky the stock or mutual fund is supposed to be. Roughly speaking, Rs 10,000 crore or over is considered a large cap. Those ranging from Rs 2 crore to 10 crore are considered mid cap, and anything under Rs 2 crore is small cap. This standard is provided by The Economic Times. Keep these numbers in mind when looking for the best mutual funds to invest in India.
The Relative Advantages of the Different Options for Market Caps
The accepted wisdom is that large cap funds are the best mutual funds in India to provide stability and predictability when it comes to investing your money. At least, that’s as close to a safe bet as you can get with the stock market where no investment is guaranteed. Small and mid-cap funds have serious growth potential, but they also carry a significant amount of risk.
The rule of thumb is that if you are saving for a short-term goal, it is best to invest your money in stable companies. In this case, large cap mutual funds are the best mutual funds to invest in India. If you do want to get risky, it is best to only do so with money you do not need for some time. That way, you have time for the market to hopefully bounce back and recoup your losses. That being said, this article on the top five mutual funds in India will focus on large cap mutual funds that people can use for stable, long-term investments. These kinds of funds are usually the most likely to pay dividends.
What is the NIFTY 50?
The NIFTY 50 is an index that serves as an indication of the overall health and success of the National Stock Exchange of India. It is the key player in an ecosystem of exchange-traded funds, exchange-traded futures, and options. Twenty sectors of the Indian economy are covered by the NIFTY 50, and it is a benchmark for some of the top performing mutual funds in India.
How to Evaluate the Performance of Mutual Funds to Find the Top Mutual Funds in India
Investing in the best performing mutual funds in India is considered a safer strategy than investing directly in the stock market, especially if you are new to the world of investing. The best mutual funds to invest in India can be costly in terms of sales and management fees, but they are so diversified and professionally managed that an investor’s exposure to risk is significantly reduced.
This does not mean that the possibility of losing money if you invest in the top mutual funds in India is eliminated. It just means that you can spread out the risk and benefit from the expertise of a professional fund manager of one of the best performing mutual funds in India.
As a result of this, mutual funds are a very popular choice among new and seasoned investors alike. This means that there are a lot of top performing mutual funds in India to choose from. While you can’t predict the markets, you can use past performance as an indicator of a fund’s potential future success.
India mutual funds advertisements often boast of their high rate of return, but if you take a close look, you’ll notice these numbers are usually only reflective of one year. You want to get a high level snapshot of a fund’s performance over a long period of time to see if it is really one of the top performing mutual funds in India. Checking out a fund’s returns over a different number of years — three years or five years — is a quick way to get an indication of its performance and whether or not it is one of the best mutual funds to invest in India.
If one of the India mutual funds you’re looking at had a fantastic return of 50% in its first year, but its returns over 3 years or 5 years went down to 20% and 18% respectively, you may want to ask what happened to bring those returns down.
Using the Fund’s Benchmark Index as an Indicator of Performance to Identify the Best Mutual Funds to Invest in India
In addition to looking at a fund’s performance over a number of years, another way to check a fund’s performance is to look at its benchmark index. If one of the supposedly top performing mutual funds in India that you’re considering returned 40%, that may seem promising; however, if its benchmark index returned 70%, then that’s a sign that this may not be a fund you want to invest in.
You can find detailed information about the best performing mutual funds in India either online or through the fund provider. Take the time to do your research to ensure your money is being held by fund managers who know how to make the best moves with your investment.
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Detailed Review – Top Ranking Mutual Funds in India
Below, please find the detailed review of each card on our list of top 5 mutual funds in India. We have highlighted some of the factors that allowed these India mutual funds to score so highly in our selection ranking.
Birla Sun Life Frontline Equity (G) Review
The Birla Sun Life Frontline Equity fund is a growth fund and one of the best mutual funds in India that was ranked number one in the Large Cap category by CRISIL. It is considered one of the best mutual funds in India for long-term investment, allowing individuals to employ an “invest it and forget it” approach to their money.
It is an open-ended fund that uses the S&P BSE 200 as its benchmark. There is no entry load, and like the other top performing mutual funds in India on this list, it has an exit load of 1.00%.
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The top holdings in this fund’s portfolio are HDFC Bank (banking/finance), Infosys (technology), Tata Motors (automotive), ICICI Bank (banking/finance), and ITC (tobacco) among others.
The fund’s sector allocation is as follows:
- Banking/finance – 30.68%
- Automotive – 10.97%
- Technology – 9.28%
- Pharmaceuticals – 8.39%
- Oil & gas – 6.98%
- Engineering – 4.82%
The fund’s asset allocation is as follows:
- Equity – 93.09%
- Unspecified – 1.12%
- Debt – 0.04%
- Mutual Funds – 2.50%
- Cash/Call – 3.27%
The fund provided returns of 18.5% over a five-year period.
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DSB BlackRock Focus 25 Fund (G) Review
The DSB BlackRock Focus 25 Fund is one of the top mutual funds in India with consistently good performance. It is an ideal place for investors looking for a safe scheme to park their money to meet their long-term investment goals. As one of the top five mutual funds in India, it was ranked number two by CRISIL in the Large Cap funds category.
As one of the best mutual funds in India, it is a growth fund and is open-ended, so investors can enter and exit the fund based on their changing investment needs. Its benchmark is the S&P BSE 200. This fund, one of the best mutual funds to invest in India, has no entry load, but investors pay an exit load of 1.00%.
The top holdings in this fund’s portfolio are SBI (banking/finance), HDFC Bank (banking/finance), Maruti Suzuki (automotive), and IndusInd Bank (banking/finance), among others.
The fund’s sector allocation is as follows:
- Banking/Finance – 37.65%
- Automotive – 14.15%
- Oil & Gas – 10.89%
- Pharmaceuticals – 10.07%
- Cement – 5.50%
- Engineering – 5.06%
The fund’s asset allocation is as follows:
This fund gave returns of 15.6% over a five-year period.
ICICI Prudential Top 100 Fund (G) Review
CRISIL ranked the ICICI Prudential Top 100 Fund number 2 in the Large Cap category. Much like BlackRock Focus fund, its performance has not been exceptional, but it has delivered good returns that make it a safe spot for long-term investors in search of fairly stable mutual funds.
This has earned it a spot on our list of the top 5 mutual funds in India. It is another growth fund that is open-ended, and it is one of the top mutual funds in India that uses the NIFTY 50 as its benchmark. There is no entry load. Investors pay an exit load of 1.00%.
The top holdings in this fund’s portfolio are Power Grid Corp. (utilities), Bharti Airtel (telecom), HDFC Bank (banking/finance), Tata Chemicals (chemicals), and Coal India (metals and mining), among others.
The fund’s sector allocation is as follows:
- Banking/finance – 16.93%
- Technology – 11.60%
- Utilities – 9.85%
- Pharmaceuticals – 8.65%
- Telecom – 8.43%
- Metals & Mining – 7.60%
The fund’s asset allocation is as follows:
- Equity – 96.68%
- Unspecified – 0.57%
- Money Market – 2.95%
The fund supplied returns of 17.6% over a five-year period.
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Kotak Select Focus Fund – Regular (G) Review
The Kotak Select Focus Fund has had consistently good returns, with an impressive ranking by CRISIL among the Large Cap funds. It is one of our choices for the top 5 mutual funds in India. It is ranked number one by CRISIL among some of the top performing mutual funds in India. It is a growth fund that is open-ended, meaning investors can enter and exit the fund as they please. Its benchmark is the NIFTY 50. It has no entry load, but it does have an exit load of 1.00%.
The top holdings in this fund’s portfolio include HDFC Bank (finance), Reliance (oil and gas), Hero Motocorp (auto), and ITC (tobacco), among others.
The fund’s sector allocation is as follows:
- Banking/Finance – 23.13%
- Oil & Gas – 15.12%
- Automotive – 13.12%
- Cement – 10.77%
- Manufacturing – 6.96%
- Engineering – 4.25%
The fund’s asset allocation is as follows:
- Equity – 90.92%
- Unspecified – 1.18%
- Debt – 0.50%
- Cash/Call – 7.40%
Over a five-year period, the fund has provided returns of 20.2%, demonstrating that it is one of the top 5 mutual funds in India for those looking for a mutual fund for long-term investment goals.
SBI Blue Chip Fund (G) Review
The SBI Blue Chip Fund is a growth fund with excellent and consistent performance that was ranked number 1 in the Large Cap category by CRISIL. It is a strong choice on our list of the top 5 mutual funds in India.
Those who are planning to invest in this fund or who have already invested in this fund can remain confident in their choice. It is an open-ended fund with an exit load of 1.00%.
The top holdings in this fund’s portfolio are HDFC Bank (banking/finance), Sun Pharma (pharmaceuticals), Bharat Elec (manufacturing), M&M (automotive), and Reliance (oil and gas), among others.
The fund’s sector allocation is as follows:
- Banking/Finance – 20.00%
- Pharmaceuticals – 11.08%
- Automotive – 10.78%
- Technology – 7.34%
- Oil & gas – 7.13%
- Engineering – 5.29%
The fund’s asset allocation is as follows:
- Equity – 82.54%
- Unspecified – 1.91%
- Money Market – 16.43%
The fund realized returns of 20.10% over a five-year period.
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Conclusion: Just Because Mutual Funds Make Investing Easy, Doesn’t Mean You Shouldn’t Do Your Research
Mutual funds, particularly the top mutual funds in India, do make investing more accessible to individuals who may not have the time or interest to invest in the stock market directly.
But just because things are made easier does not mean investors should blindly give their money to just any fund manager, even if they claim to have one of the best mutual funds in India.
Instead, take a look at a fund’s past performance, the amount of sales fees (or loads) that you are obligated to pay, its benchmark index, and the track record of its managers before you invest.
AdvisoryHQ (AHQ) Disclaimer:
Reasonable efforts have been made by AdvisoryHQ to present accurate information, however all info is presented without warranty. Review AdvisoryHQ’s Terms for details. Also review each firm’s site for the most updated data, rates and info.
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