You must have seen the advertisement of Cricketers saying ” Time spent in the Indian market is correct for mutual fund investment”. Though those Advertisements are a bit silly but still true to a great extent. In this blog, we will discuss the best mutual fund in India for the long term that can help you generate more returns.
There are numerous mutual funds available in the Indian Market. therefore it’s a bit confusing to select the good one among them. In this blog, we are going to list 5 of the best Mutual fund in India for the long term where you can invest. These Funds are from all categories like Small-cap funds, Midcap funds, and large-cap funds. While choosing these funds we have also considered the diversification you will get in your portfolio. These funds are good for long term, SIP investment, and also for lumpsum investment. You will see the detailed analysis of these funds here.
Now let’s start our list of best mutual fund in India for long term investment.
PARAG PARIKH FLEXI CAP FUND
At the present time, it is one of the favorite funds of investors. The main reason behind this is, it invests its money both in Indian equity as well as in foreign equity. If we talk about its assets under management (AUM), it is about 17,220crs. By seeing AUM many people have doubts in their minds about its future performance. We all know that if a fund is performing well then no doubt the AUM will normally grow. So we don’t have to worry about its future performance. It is going to rock in the near future. If we see its expense ratio. it is about 0.83% and if we discuss its sector-wise allocation then you will see that it invests its money in technology, financial, services, automobiles, and FMCG. If we will talk about its market cap allocation then it invests its money in the large-cap, mid-cap, and small-cap. This fund majorly invests its money in the technology sector because it invests lots of money in the foreign equity technology sector industry.
Now let’s see details investments in the top companies that it invests in. The highest amount is approximately 9.11% in Google, 8.54% in Bajaj holdings, and also in Microsoft corporation, Amazon, and Facebook. This fund is value-oriented in Indian equity. The principle of this fund is, that it invests the major money in such companies whom the market is totally ignoring and when the companies are performing best then it gives a better return. Earlier the companies like Indian energy exchange, icici bank, axis bank, etc were not performing well but they were in their portfolio. Suddenly these are performing well so it gives better returns nowadays.
Let’s discuss its SIP return, if 5years ago you start a SIP of 1000 rupees then after 5years it gives a return of about 1 lakh 20 thousand i.e 28% return, in 3yrs 39%, in 2yrs 50% and in 1yrs 45% return.
On the basis of return and under the Flexi cap category it is one of the best performing funds. This fund may generate the best return on a long-term plan. But friends if you are going to invest in this fund then you should wait for about 5-7 years for a better return.
Axis small-cap fund
Now it’s handling an AUM of more than 7000 Crore or accurately Rs 7362 Crs and with a minimum expense ratio of about 0.37%. This fund is not so greedy in charging so much expense ratio from investors. Fund houses like Excess mutual fund houses, and Mirai mutual fund houses have low expense ratios. Due to these, investors are getting lots of profit. If we see its sector allocation then it invests money in construction, technology, chemicals, FMCG, and Finance. The main benefit of investing money in the small-cap fund is that you will be getting lots of different sectors and as a result, your portfolio gains a better diversification.
If we will look into its market allocation then it invests money in large-cap (2.29%),mid-cap (36.95%), and the maximum amount in small-cap i.e 52.96%. This fund tries to generate more returns by taking fewer risks. Friends according to my point of view this fund is quite good because it invests money also in the mid-cap for managing the risk. This fund does not change its portfolio frequently. It chooses companies through detailed research and adds companies to its portfolio from a long-term perspective, which is one of the best things for the small-cap fund.
Let’s discuss its performance. If you invest 1k per month for 5 years then it gives a return of about 125712 i.e more than 30%, in 3yrs 44%, in 2yrs 58% & in 1yrs 55% of return.
Canara Robeco Bluechip fund
Its Asset under management is low i.e. approximately Rs.5070 Crs and the expense ratio is also low i.e. 0.37%. If we view its sector-wise allocation then it invests 71.21% of total money in the financial, technology, energy, construction, and automobile sector and if we see its market cap allocation then most allocation in the large-cap I.e 86.42% and in the mid-cap is 7.94%, for generating some extra return to the investors. The top 10 companies in the portfolio of this fund are bluechip, ICIC Bank, Reliance Industries, SBI, TCS, Infosys, HDFC, Axis bank, HDFC bank, L&T, Bajaj finance, etc. This fund also does not change its portfolio frequently and adds these companies in terms of long-term plans.
Now let’s analyze its SIP return. If one invests an amount of 1k in one month over 5year then it gives a return of about Rs 102526 i.e. 22%, in 5yrs, and 28%,34% in 3 and 2 years respectively.
The most important thing is we can’t compare the return of large-cap funds with small and Flexi cap funds because the risk profile is totally different. It is one of the best large-cap funds that beat its benchmark index regularly.
Mirae assest mid cap fund
This fund has an AUM of more than 6000 Crs i.e. Rs 6737 Crs and the expense ratio is 0.49% only. If we see its sector-wise allocation value then it invests money in the financial, healthcare, automobile, engineering, and FMCG sector. Also, its market allocation is quite good in large-cap i.e. 28.08%, in mid-cap 62.28% & in small-cap 8.99%. This fund proceeds with a good combination of all 3 types of companies. This fund does much diversification in his portfolio. You might not listen to the name of this fund because it is not so older i.e. 2 years older only. companies in his portfolio are the federal bank, Jindal steel, and power, Bharat electronics, Crompton services, etc.
According to us, this fund will perform best in long run. But nowadays also this fund is performing very well. If you did a SIP of 1k per month up to 2yrs then it gives a return of about 54% (Rs 38891) & and in 1yr 45% (Rs 14543).
Axis growth opportunities fund
This fund is not so older (i.e 3 years old only) and famous. Due to this reason the AUM is quite limited i.e. Rs 5006 Crs only and an expense ratio of only 0.51%. Like the Parag Parikh fund, this fund also invests money in a mixture of both foreign and Indian equity. It invests 75.31% of its total fund in sectors like the technology, financial, chemicals, services,& Healthcare sectors. The market-wise allocation of this fund is quite diversified i.e. in large-cap 37.95%, in midcap 54.98% & in small-cap 5.55%. Here also we see a diverse portfolio as this fund invests money in the companies like Tata Elxso, Bajaj finance, Torrent power, NIIT technologies, Info Edge (India), etc. So basically this fund is a combination of large and mid-cap companies.
If we did a SIP OF 1k per month for 3yrs then it gives a return of 38% I.e (Rs. 61683), in 2yrs 49% (Rs 37294 ), and in 1yrs 45%( Rs14759). In terms of return, this fund is also quite good and it will perform best in long term.
Now if you want the summary of the blog in a simple way then here are the funds that can help you generate higher returns in long run. The funds are Axis Small-cap fund (60% return), Mirae Asset Midcap fund (55% return), Axis growth opportunities fund (50% return), and Parag Parikh Flexi Cap Fund (48% return), Canara Robeco Bluechip fund (33% return).
If you are investing in any long-term fund then you must compare its benchmark on a regular basis. if in 2-3 years this fund is not reaching its benchmark then you should consider leaving that fund.
Thank you for reading this blog. We hope that this was helpful to you. We also hope that your search for the best mutual fund in India for the long term will end here. Please comment on which Mutual fund from the above list you will like to invest in. Also, you can comment any other mutual fund you think is best in long run.
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