While investors often chase top-performing mutual funds to grow their wealth, it’s equally important to understand which funds have struggled. The last one year (2024–2025) has seen significant volatility in equity markets, especially in technology and small-cap segments. Some funds that were previously popular or newly launched have taken a major beating. In this article, we highlight the 10 worst performing mutual funds in the past one year in 2025, with returns ranging from -16% to -12%.
How We Filtered These Funds?
To identify these underperforming schemes, we followed a clear selection methodology:
- Considered all equity mutual funds of Direct Plans listed on AMFI.
- Filtered only those that gave negative returns in the last one year.
- From these, we selected the top 10 worst performers, all showing returns between -16% and -12%.
- Interestingly, most of these are relatively new funds, launched within the last 3 years, and many of them are focused on the IT or small-cap segments.
- It is important to review your funds periodically, otherwise you would end up in investing like we indicated in our worst performing mutual funds in the last 20 years.
Top 10 Worst Performing Mutual Funds in the last 1 year in 2025
- Samco Flexi Cap Fund – 1-Year Return: -16.4%
- Bandhan Nifty IT Index Fund – 1-Year Return: -14.2%
- Axis Nifty IT Index Fund – 1-Year Return: -14.2%
- ICICI Prudential Nifty IT Index Fund – 1-Year Return: -14.1%
- Nippon India Nifty IT Index Fund – 1-Year Return: -14.0%
- Navi Nifty IT Index Fund – 1-Year Return: -14.0%
- Mirae Asset Nifty Smallcap 250 Momentum Quality 100 ETF FoF – 1-Year Return: -12.8%
- DSP Nifty Smallcap250 Quality 50 Index Fund – 1-Year Return: -12.2%
- Quant Teck Fund – 1-Year Return: -12.0%
- Samco ELSS Tax Saver Fund – 1-Year Return: -12.0%
Top 10 Worst Performing Mutual Funds in last 1 Year
1. Samco Flexi Cap Fund
Fund Objective: The fund aims to invest across market capitalizations—large, mid, and small caps—seeking long-term capital appreciation. However, concentrated bets and market volatility have hit performance hard in the past year.
Performance Snapshot:
- 1-Year CAGR: -16.4%
- 3-Year CAGR: 2.7%
Who Can Invest: Suitable for investors with a long-term horizon (5+ years) who can tolerate high volatility and want diversified exposure across market caps.
Risk Factors: High exposure to mid and small caps makes it vulnerable to market downturns and concentration risk.
This fund continue to underperform like we indicated in our 10 Mutual Funds That Crashed the Most Since Last Diwali (-14% to -17%).
2. Bandhan Nifty IT Index Fund
Fund Objective: This passive index fund mirrors the performance of the Nifty IT Index. The IT sector faced earnings pressure and valuation correction, leading to sharp underperformance.
Performance Snapshot:
- 1-Year CAGR: -14.2%
Who Can Invest: Suitable for investors who believe in the long-term growth of India’s IT sector and prefer passive investing.
Risk Factors: Highly concentrated in one sector; global demand slowdown can heavily impact returns.
3. Axis Nifty IT Index Fund
Fund Objective: This fund tracks the Nifty IT Index and provides exposure to leading technology companies. The sector’s global demand slowdown and high valuations hurt returns.
Performance Snapshot:
- 1-Year CAGR: -14.2%
Who Can Invest: Ideal for investors looking for a focused IT exposure and willing to ride out sector volatility.
Risk Factors: Sectoral risk, dependency on global IT demand, and currency fluctuations.
Apart from tariff and policy uncertainties, IT mutual funds are underperforming due to a global slowdown in tech spending, margin pressures from rising costs, currency fluctuations, and high valuations amid weak earnings growth. We could see this in 10 Mutual Funds That Crashed the Most in the Last 6 Months in 2025.
4. ICICI Prudential Nifty IT Index Fund
Fund Objective: Seeks to replicate the Nifty IT Index. Despite a decent 3-year return, recent correction in tech stocks weighed heavily on short-term performance.
Performance Snapshot:
- 1-Year CAGR: -14.1%
- 3-Year CAGR: 8.7%
Who Can Invest: Best for investors with moderate-to-high risk appetite and a belief in long-term IT growth.
Risk Factors: Sectoral dependence, high volatility, and sensitivity to global economic trends.
5. Nippon India Nifty IT Index Fund
Fund Objective: This fund aims to generate returns in line with the Nifty IT Index. However, exposure to large-cap IT stocks like Infosys, Wipro, and TCS led to short-term underperformance.
Performance Snapshot:
- 1-Year CAGR: -14.0%
Who Can Invest: Suitable for investors looking for passive IT exposure through a trusted AMC.
Risk Factors: Limited diversification; performance tied closely to IT sector dynamics.
6. Navi Nifty IT Index Fund
Fund Objective: Another IT index fund that closely tracks Nifty IT. The fund’s returns were dragged down by sectoral weakness and global technology spending cuts.
Performance Snapshot:
- 1-Year CAGR: -14.0%
Who Can Invest: Suitable for investors comfortable with sector-specific exposure and index-based investing.
Risk Factors: Sectoral and global exposure risk; performance can swing based on tech cycles.
Investors can also explore – 10 Worst Performing Mutual Funds in the Last 15 Years (4.4% to 9.0% CAGR Returns).
7. Mirae Asset Nifty Smallcap 250 Momentum Quality 100 ETF FoF
Fund Objective: This fund invests in an ETF tracking small-cap and momentum stocks. The high volatility in small-cap stocks during the year impacted performance severely.
Performance Snapshot:
- 1-Year CAGR: -12.8%
Who Can Invest: Suitable for aggressive investors seeking small-cap momentum exposure with a long-term horizon.
Risk Factors: High volatility, liquidity risk, and sharp drawdowns in small-cap segments.
Check 10 Worst Performing Mutual Funds in the Last 5 Years (1.7% to 9.1% CAGR Returns).
8. DSP Nifty Smallcap250 Quality 50 Index Fund
Fund Objective: Designed to track a basket of quality small-cap stocks. However, the small-cap correction and profit-booking by investors hit returns.
Performance Snapshot:
- 1-Year CAGR: -12.2%
Who Can Invest: Suitable for long-term investors looking to capitalize on small-cap growth potential.
Risk Factors: High volatility, potential liquidity issues, and sector concentration risks.
9. Quant Teck Fund
Fund Objective: A thematic technology fund launched to benefit from digital transformation trends. The tech sell-off and correction in IT valuations led to double-digit losses.
Performance Snapshot:
- 1-Year CAGR: -12.0%
Who Can Invest: Ideal for thematic investors who want exposure to India’s technology innovation theme.
Risk Factors: Theme concentration, global tech valuation risks, and short-term cyclicality.
10. Samco ELSS Tax Saver Fund
Fund Objective: This ELSS fund aims for long-term capital appreciation through diversified equity exposure. However, being a relatively new scheme, it has struggled amid volatile markets.
Performance Snapshot:
- 1-Year CAGR: -12.0%
Who Can Invest: Suitable for investors looking for tax-saving options under Section 80C and long-term wealth creation.
Risk Factors: Market risk, limited track record, and exposure to volatile mid/small-cap stocks.
Summary of Performance
| Fund Name | 1 Yr Return | 3 Yr Return | 5 Yr Return |
|---|---|---|---|
| Samco Flexi Cap Fund | -16.4% | 2.7% | — |
| Bandhan Nifty IT Index Fund | -14.2% | — | — |
| Axis Nifty IT Index Fund | -14.2% | — | — |
| ICICI Prudential Nifty IT Index Fund | -14.1% | 8.7% | — |
| Nippon India Nifty IT Index Fund | -14.0% | — | — |
| Navi Nifty IT Index Fund | -14.0% | — | — |
| Mirae Asset Nifty Smallcap 250 Momentum Quality 100 ETF FoF | -12.8% | — | — |
| DSP Nifty Smallcap250 Quality 50 Index Fund | -12.2% | — | — |
| Quant Teck Fund | -12.0% | — | — |
| Samco ELSS Tax Saver Fund | -12.0% | — | — |
Conclusion
While mutual funds are long-term wealth creation tools, short-term underperformance—especially in certain sectors—shouldn’t discourage investors. Most of the funds listed here are sector-specific or new schemes that faced market headwinds. Investors should always focus on long-term performance, diversification, and consistency before making any decision. Avoid reacting to short-term losses; instead, align your investments with your long-term financial goals.
- SIP vs Term Insurance – What to Prioritise First? - January 27, 2026
- How InvestingPro from Investing.com Uses AI to Improve Investment Decisions - January 26, 2026
- Where Should You Invest in 2026? Top Mutual Fund Categories Based on Interest Rates & Market Risks - January 18, 2026