10 Best Mutual Funds for Next 10 Years

One of the best ways to create wealth is to invest in mutual fund schemes. In the medium to long term, these can fetch good returns. However, investors should consider selecting funds based on their financial goals, risk appetite and tenure of the investment.  In this article we would provide the list of 10 Best Mutual Funds for Next 10 years to invest in India.

Why to invest in Mutual Funds?

Before getting into the specific list of mutual funds to invest for next 10 years, let us understand the fundamentals of mutual funds. While there are several investment options, mutual funds has been gaining prominence in the last few years. Some of the mutual funds have generated 10x to 12x returns in the last 10 years. Mutual Funds pool money from multiple investors to purchase a diversified portfolio of stocks, bonds, or other securities, managed by professional fund managers.

Best Mutual Funds for Next 10 Years

What are the benefits of investing in mutual funds?

  1. Diversification: Mutual Funds does not invest in single stock or bond. They spread the investment across various assets which helps to reduce the risk.
  2. Professional Management: Expert fund managers make informed investment decisions on your behalf.
  3. Liquidity: Investors can buy and sell mutual fund units based on NAV (Net Asset Value) at any given point of time except where there is lock-in period.
  4. Transparency: Fund houses keeps providing updates on the portfolio.
  5. Affordability: Investors can invest as low as Rs 500 in mutual funds. In some funds they can invest even as low as Rs 100.

What is the Economic Outlook for India?

Before identifying the best mutual funds for the next 10 years, let’s assess the economic landscape of India and key factors shaping its growth.

  1. Demographic Dividend: With a young and dynamic population, India enjoys a significant demographic advantage, fueling consumption and economic growth.
  2. Infrastructure Development: Government initiatives and investments in infrastructure projects aim to enhance connectivity, spur economic activity, and attract investments. Our recommended Infrastructure mutual funds in 2022 have doubled in the last 2 years.
  3. Digital Transformation: The rapid adoption of digital technologies is revolutionizing various sectors, boosting efficiency and innovation.
  4. Emerging Sectors: Industries such as renewable energy, healthcare, and e-commerce present lucrative opportunities for investors, driven by evolving consumer preferences and technological advancements.

Best Mutual Funds for Next 10 Years to Invest in India:

Now, let’s explore the top 10 mutual funds to invest for next decade, considering factors such as historical performance, fund management expertise, and investment strategy. We have provided 2 table, one based on annualized returns and second based on SIP returns. One can use them like a model mutual fund portfolio for investments.

Best Mutual Funds for Next 10 Years – Annualised Returns

Category Mutual Fund Name 3 Yrs 5 Yrs 10 Yrs
Index / Largecap UTI Nifty 50 Index Fund 16.2% 14.8% 13.8%
Index / Largecap UTI Nifty Next 50 Index Fund 23.2% 19.0% NA
Index / Largecap Nippon India Largecap Fund 26.8% 18.8% 18.4%
Index / Largecap Baroda BNP Paribas Large Cap Fund 19.8% 18.0% 16.2%
Midcap / Smallcap Quant Mid Cap Fund 38.3% 35.3% 21.9%
Midcap / Smallcap SBI Small Cap Fund 25.4% 26.8% 27.2%
Flexicap Parag Parikh Flexi Cap fund 22.7% 24.5% 20.0%
Flexicap Quant Flexicap fund 32.5% 32.0% 24.3%
Hybrid ICICI Prudential Equity & Debt Fund 26.2% 26.0% 19.8%
International Motilal Oswal Nasdaq 100 FoF 12.0% 21.8% NA

Best Mutual Funds for Next 10 Years – SIP Returns

Category Mutual Fund Name 3 Yrs 5 Yrs 10 Yrs
Index / Largecap UTI Nifty Index Fund 15.8% 18.0% 14.3%
Index / Largecap UTI Nifty Next 50 Index Fund 30.5% 25.7% NA
Index / Largecap Nippon India Largecap Fund 28.0% 26.7% 18.3%
Index / Largecap Baroda BNP Paribas Large Cap Fund 24.4% 22.8% 17.0%
Midcap / Smallcap Quant Mid Cap Fund 42.2% 42.6% 26.5%
Midcap / Smallcap SBI Small Cap Fund 25.8% 30.1% 23.6%
Flexicap Parag Parikh Flexi Cap fund 24.7% 26.8% 20.9%
Flexicap Quant Flexicap fund 34.0% 38.0% 25.4%
Hybrid ICICI Prudential Equity & Debt Fund 26.2% 26.8% 19.1%
International Motilal Oswal Nasdaq 100 FoF 19.2% 19.9% NA

Investment Strategies for Long-Term Growth:

While selecting mutual funds for the next 10 years, it’s crucial to adopt a disciplined investment strategy aligned with your financial goals and risk tolerance.

  1. Asset Allocation: Diversify your portfolio across asset classes to mitigate risk and enhance returns.
  2. Systematic Investment Plan (SIP): Invest regularly through SIPs to benefit from rupee cost averaging and harness the power of compounding. One can easily make out 1 Crore with 5,000 per month SIP investments.
  3. Stay Informed: Keep an eye on market developments, economic indicators, and fund performance to make informed investment decisions.
  4. Review and Rebalance: Periodically review your investment portfolio and rebalance it to maintain optimal asset allocation and adapt to changing market conditions.

FAQs (Frequently Asked Questions):

To address common queries regarding mutual fund investments, here are some frequently asked questions along with detailed answers:

1. What are the key factors to consider when selecting mutual funds for long-term investment?

First step is to consider financial goal, risk appetite and tenure of investment. As a second step, when selecting mutual funds for long-term investment, consider factors such as historical performance, fund manager expertise, investment strategy, expense ratio, and risk-adjusted returns.

2. How can I assess the risk associated with mutual fund investments?

You can assess the risk associated with mutual fund investments by analyzing factors such as the fund’s investment objective, asset allocation, portfolio diversification, and historical volatility.

3. Is it advisable to invest in sector-specific mutual funds for long-term growth?

Investing in sector-specific mutual funds can be risky as it exposes your portfolio to concentration risk. It’s advisable to opt for diversified equity funds with exposure to multiple sectors for long-term growth.

4. What role does inflation play in mutual fund investments?

Inflation erodes the purchasing power of money over time, affecting the real returns on your investments. It’s essential to choose mutual funds that offer returns exceeding the inflation rate to preserve and grow your wealth. Investors should periodically check and should not end up in investing in bad funds which we indicated in our Worst Performing Mutual Funds in the last 10 year.

5. How often should I review my mutual fund investments?

It’s recommended to review your mutual fund investments periodically, typically every six months to a year, to ensure they remain aligned with your financial goals and risk tolerance. Make adjustments as necessary based on changes in market conditions or your investment objectives.

6. Can mutual funds help me achieve my long-term financial goals such as retirement planning?

Yes, mutual funds can play a crucial role in helping you achieve long-term financial goals such as retirement planning by offering the potential for capital appreciation and regular income through systematic investments over time. They should also build strategy and opt for Two Bucket Strategy of Investment which can help them to get maximum benefit.

Conclusion: In conclusion, selecting the best mutual funds for the next 10 years requires careful consideration of various factors, including economic outlook, fund performance, and investment strategy. By diversifying your portfolio across equity funds, adhering to a disciplined investment approach, and staying informed about market trends, you can build a robust investment portfolio geared towards long-term growth and wealth creation.

Suresh KP

7 comments

  1. Sir,
    I am 72 years old. My investments are in Large cap funds, Retirement Benefit fund, Balanced advantage fund, multi asset fund in various AMCs since 2015. Total sums invested is Rs. 30 lacs and the market value is 59 lacs. Kindly advise, whether I should I continue with these funds or there are alternatives in mutual fund schemes aged person like me.

    1. investing in largecap funds, balance advantage funds and multi asset fund are good. You can review and exit retirement benefit funds. Also keep your basics covered (insurance and emergency fund). Since your motto should be to protect capital too, I would recommend you to do portfolio balancing by investing in debt funds too that would provide fixed income. Investing entire in equity at your age is not advisable.

  2. Nice article.
    I request you to write article about portfolio balancing technique for someone once achieve enough corpus (ex: financial independence amount or 30*yearly expanse)

  3. Hi Suresh,

    I have 10 lacs and I might have to take it out for expenditure in an year or so(unclear but definitely within 2 years)

    1. Where can keep this parked so it gives me better returns ( fd,bonds, tax savings etc is not an option for me)
    2. Would there be a capital gain and how to handle the same?
    3. Are there any other best practices that you can advise?

    1. For short term of 1 to 2 years, I would recommend going for ultra short term mutual funds that can generate 7% to 8% annualised returns

      1. Thanks Suresh..would also be able to advise on the other aspects like capital gain and any other best practices?

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