Investing in mutual funds remains one of the simplest and most effective ways to create long-term wealth. Whether you are investing for retirement, your child’s education, buying a home, or achieving financial independence, equity mutual funds have historically rewarded disciplined investors who stay invested for the long term.
However, choosing the right mutual fund is not easy. With hundreds of equity mutual fund schemes available across various categories, investors often struggle to identify funds that have consistently performed well. One of the widely followed research platforms in India, Value Research, assigns star ratings to mutual funds based on their historical risk-adjusted performance. While these ratings should not be the sole basis for investment decisions, they can be a useful starting point for shortlisting quality funds.
Last year, we published an article on 13 Wealth Builder Mutual Funds with 5-Star Rating from Value Research, which received an excellent response from our readers. Since mutual fund ratings and performance keep changing over time, we have refreshed the list with the latest available data as of 7-August-2026.
In this article, we will review 15 Wealth Builder Mutual Funds with 5-Star Rating from Value Research, understand their investment objectives, analyse their historical performance, and discuss the type of investors for whom these schemes may be suitable.
What are ‘Wealth Builder’ Mutual Funds as per Value Research?
Value Research identifies certain equity mutual fund categories as long-term wealth builders because of their ability to generate capital appreciation across different market cycles. These schemes generally invest in fundamentally strong companies and are suitable for investors with a long investment horizon.
Some of these categories include:
- Flexi Cap Funds
- Large & Mid Cap Funds
- Value Funds
- Retirement-oriented Equity Funds
- Children’s Equity Funds
- Value-based Index Funds
- Equity Fund of Funds
For this article, we have considered only those mutual fund schemes that currently have a 5-Star Rating from Value Research.
How Did We Filter These Wealth Builder Mutual Funds?
We shortlisted these mutual funds based on the following criteria:
- Only 5-Star Rated mutual funds from Value Research.
- Data considered as of 7-August-2026.
- Equity-oriented schemes aimed at long-term wealth creation.
- Latest available 3-Year, 5-Year and 10-Year CAGR performance.
Note: Star ratings are dynamic and may change periodically based on a scheme’s relative performance compared to its peers. Investors should evaluate a fund’s investment objective, portfolio, risk profile and suitability before making any investment decision.
15 Wealth Builder Mutual Funds with 5-Star Rating from Value Research to Invest in 2026
| Category | Mutual Fund | 3-Year CAGR |
|---|---|---|
| Value Index | UTI Nifty 500 Value 50 Index Fund | 26.4% |
| Value Index | Motilal Oswal BSE Enhanced Value Index Fund | 25.6% |
| Large & Mid Cap | Motilal Oswal Large and Midcap Fund | 23.6% |
| Children’s Fund | SBI Children’s Fund – Investment Plan | 22.4% |
| Retirement Fund | ICICI Prudential Retirement Fund – Pure Equity Plan | 22.4% |
| Flexi Cap | Bank of India Flexi Cap Fund | 21.6% |
| Flexi Cap | ITI Flexi Cap Fund | 20.3% |
| Large & Mid Cap | Bandhan Large & Mid Cap Fund | 20.3% |
| Value Fund | HSBC Value Fund | 18.9% |
| Value Fund | DSP Value Fund | 18.2% |
| Large & Mid Cap | ICICI Prudential Large & Mid Cap Fund | 18.1% |
| Flexi Cap | HDFC Flexi Cap Fund | 18.0% |
| Fund of Funds | ICICI Prudential Diversified Equity All Cap Omni FoF | 17.3% |
| Flexi Cap | Parag Parikh Flexi Cap Fund | 14.7% |
| Value Fund | ICICI Prudential Value Fund | 14.6% |
Detailed Review of Each Mutual Fund
1) UTI Nifty 500 Value 50 Index Fund
Fund Objective
UTI Nifty 500 Value 50 Index Fund aims to replicate the performance of the Nifty 500 Value 50 Index by investing in companies that are identified as value stocks based on predefined parameters. Being a passive fund, it seeks to mirror the benchmark index rather than outperform it.
Annualised Returns
- 3-Year CAGR: 26.4%
- 5-Year CAGR: Not Available
- 10-Year CAGR: Not Available
Who Can Invest?
- Investors looking for a passive investment strategy.
- Those who believe in long-term value investing.
- Investors with an investment horizon of at least 5 years.
Risk Factors
- Returns may lag growth-oriented funds during certain market phases.
- Since it is an index fund, it aims to replicate the benchmark and not outperform it.
- Equity market volatility can impact short-term performance.
2) Motilal Oswal BSE Enhanced Value Index Fund
Fund Objective
This index fund seeks to replicate the performance of the BSE Enhanced Value Index by investing in fundamentally strong companies trading at attractive valuations. It offers investors a low-cost passive investment option with a value investing approach.
Annualised Returns
- 3-Year CAGR: 25.6%
- 5-Year CAGR: Not Available
- 10-Year CAGR: Not Available
Who Can Invest?
- Investors preferring passive investing.
- Long-term investors seeking exposure to value stocks.
- Investors looking for relatively lower expense ratios compared to actively managed funds.
Risk Factors
- Performance depends entirely on the underlying benchmark index.
- Value investing may underperform growth investing for extended periods.
- Equity market fluctuations can impact returns.
We have listed this fund as part of 10 Mutual Funds That Generated 27% to 42% CAGR in the Last 3 Years.
3) Motilal Oswal Large and Midcap Fund
Fund Objective
Motilal Oswal Large and Midcap Fund invests in a combination of large-cap and mid-cap companies with the objective of generating long-term capital appreciation. The large-cap allocation provides relative stability, while the mid-cap exposure offers the potential for higher growth.
Annualised Returns
- 3-Year CAGR: 23.6%
- 5-Year CAGR: 19.6%
- 10-Year CAGR: Not Available
Who Can Invest?
- Investors with a long-term investment horizon of 5 years or more.
- Those looking for a balance between stability and growth.
- Investors comfortable with moderate to high market volatility.
Risk Factors
- Mid-cap stocks can experience higher volatility than large-cap stocks.
- Returns may fluctuate significantly during market corrections.
- Suitable only for investors with a higher risk appetite.
4) SBI Children’s Fund – Investment Plan
Fund Objective
SBI Children’s Fund – Investment Plan is designed to help parents build a long-term corpus for important financial goals such as higher education, professional courses and marriage expenses by investing predominantly in equities.
Annualised Returns
- 3-Year CAGR: 22.4%
- 5-Year CAGR: 21.5%
- 10-Year CAGR: Not Available
Who Can Invest?
- Parents planning for their children’s future financial goals.
- Investors who can remain invested for the long term.
- Those looking for a goal-based investment solution.
Risk Factors
- The scheme comes with lock-in conditions applicable to children’s funds.
- Equity investments are subject to market risks.
- Short-term volatility should not influence long-term investment decisions.
5) ICICI Prudential Retirement Fund – Pure Equity Plan
Fund Objective
ICICI Prudential Retirement Fund – Pure Equity Plan primarily invests in equity and equity-related instruments with the objective of creating wealth for retirement. It is designed for investors who have a long investment horizon and wish to build a retirement corpus.
Annualised Returns
- 3-Year CAGR: 22.4%
- 5-Year CAGR: 21.1%
- 10-Year CAGR: Not Available
Who Can Invest?
- Investors planning for retirement.
- Individuals with an investment horizon of 10 years or more.
- Investors seeking long-term capital appreciation through equity investments.
Risk Factors
- The scheme has lock-in provisions applicable to retirement funds.
- Equity markets can be volatile in the short term.
- Investors should stay invested through market cycles to benefit from long-term compounding.
This fund is part of 12 Mutual Funds that generated positive returns every year in the last 5 years.
6) Bank of India Flexi Cap Fund
Fund Objective
Bank of India Flexi Cap Fund aims to generate long-term capital appreciation by investing across large-cap, mid-cap and small-cap companies. The fund manager has the flexibility to change the allocation across market capitalisations depending on market opportunities.
Annualised Returns
- 3-Year CAGR: 21.6%
- 5-Year CAGR: 17.7%
- 10-Year CAGR: Not Available
Who Can Invest?
- Investors seeking diversification across market capitalisations.
- Those with a long-term investment horizon of at least 5-7 years.
- Investors comfortable with moderate to high market volatility.
Risk Factors
- Returns may fluctuate depending on the fund manager’s allocation strategy.
- Mid-cap and small-cap exposure can increase volatility.
- Suitable only for investors with a higher risk appetite.
7) ITI Flexi Cap Fund
Fund Objective
ITI Flexi Cap Fund seeks to generate long-term capital appreciation by investing across companies of different market capitalisations. The flexible investment mandate allows the fund manager to identify opportunities across sectors and market segments.
Annualised Returns
- 3-Year CAGR: 20.3%
- 5-Year CAGR: Not Available
- 10-Year CAGR: Not Available
Who Can Invest?
- Investors looking for a diversified equity portfolio.
- Those investing with a long-term perspective.
- Investors who can tolerate market fluctuations.
Risk Factors
- Limited long-term performance history compared to older funds.
- Market corrections can impact short-term returns.
- Performance depends on stock selection and allocation decisions.
8) Bandhan Large & Mid Cap Fund
Fund Objective
Bandhan Large & Mid Cap Fund invests predominantly in large-cap and mid-cap companies with the objective of delivering long-term capital appreciation. The combination of large-cap stability and mid-cap growth potential makes it suitable for long-term wealth creation.
Annualised Returns
- 3-Year CAGR: 20.3%
- 5-Year CAGR: 18.0%
- 10-Year CAGR: 16.5%
Who Can Invest?
- Investors looking for a balance between stability and growth.
- Individuals with an investment horizon of at least five years.
- Investors willing to accept moderate market volatility.
Risk Factors
- Mid-cap stocks can experience sharp corrections during weak market phases.
- Performance depends on overall market conditions.
- Equity investments are subject to market risks.
9) HSBC Value Fund
Fund Objective
HSBC Value Fund follows a value investing strategy by investing in fundamentally strong companies that are available at attractive valuations. The objective is to generate long-term capital appreciation while maintaining a diversified portfolio.
Annualised Returns
- 3-Year CAGR: 18.9%
- 5-Year CAGR: 17.5%
- 10-Year CAGR: 16.3%
Who Can Invest?
- Investors who believe in value investing.
- Long-term investors willing to remain invested through market cycles.
- Investors seeking diversification across sectors.
Risk Factors
- Value investing may remain out of favour for extended periods.
- Recovery in undervalued stocks may take longer than expected.
- Returns can be volatile in the short term.
Earlier we covered this fund part of 6 Best Value Mutual Funds in India article.
10) DSP Value Fund
Fund Objective
DSP Value Fund primarily invests in undervalued companies with strong business fundamentals and long-term growth potential. The fund follows a disciplined value investing approach while maintaining diversification across sectors.
Annualised Returns
- 3-Year CAGR: 18.2%
- 5-Year CAGR: 14.3%
- 10-Year CAGR: Not Available
Who Can Invest?
- Investors seeking long-term capital appreciation through value investing.
- Investors who can stay invested for at least 5-7 years.
- Those comfortable with temporary underperformance during certain market cycles.
Risk Factors
- Value-oriented investing requires patience.
- Some undervalued stocks may remain undervalued for extended periods.
- Equity market volatility can affect short-term returns.
11) ICICI Prudential Large & Mid Cap Fund
Fund Objective
ICICI Prudential Large & Mid Cap Fund aims to generate long-term capital appreciation by investing predominantly in a mix of large-cap and mid-cap companies. The fund seeks to balance the stability offered by established companies with the higher growth potential of emerging businesses.
Annualised Returns
- 3-Year CAGR: 18.1%
- 5-Year CAGR: 18.2%
- 10-Year CAGR: 16.2%
Who Can Invest?
- Investors seeking a combination of stability and growth.
- Those with an investment horizon of at least 5 years.
- Investors comfortable with moderate market volatility.
Risk Factors
- Mid-cap allocation can increase portfolio volatility.
- Equity market corrections may impact short-term returns.
- Suitable only for long-term investors.
12) HDFC Flexi Cap Fund
Fund Objective
HDFC Flexi Cap Fund seeks to generate long-term capital appreciation by investing across large-cap, mid-cap and small-cap companies. The flexible investment strategy enables the fund manager to allocate assets based on market opportunities.
Annualised Returns
- 3-Year CAGR: 18.0%
- 5-Year CAGR: 18.7%
- 10-Year CAGR: 16.5%
Who Can Invest?
- Investors looking for diversified equity exposure.
- Individuals with a long-term investment horizon.
- Investors seeking a professionally managed flexi-cap portfolio.
Risk Factors
- Returns depend on market conditions and fund manager’s allocation decisions.
- Mid-cap and small-cap exposure may increase volatility.
- Equity investments are subject to market risks.
This fund is part of 5 Best Flexicap Mutual Funds to invest in 2026 based on rolling returns.
13) ICICI Prudential Diversified Equity All Cap Omni FoF
Fund Objective
ICICI Prudential Diversified Equity All Cap Omni FoF invests in a portfolio of equity mutual funds across different market capitalisations and investment styles. The objective is to provide investors with diversified exposure through a single fund.
Annualised Returns
- 3-Year CAGR: 17.3%
- 5-Year CAGR: 16.5%
- 10-Year CAGR: Not Available
Who Can Invest?
- Beginners looking for diversified equity exposure.
- Investors preferring a single fund that invests across multiple schemes.
- Long-term investors with moderate to high risk appetite.
Risk Factors
- Fund of Funds structure may result in a higher overall expense ratio.
- Performance depends on the underlying mutual fund schemes.
- Market risks applicable to all underlying equity funds.
14) Parag Parikh Flexi Cap Fund
Fund Objective
Parag Parikh Flexi Cap Fund aims to generate long-term capital appreciation by investing across market capitalisations while following a value-oriented investment approach. The fund has historically maintained a differentiated investment philosophy with a focus on quality businesses.
Annualised Returns
- 3-Year CAGR: 14.7%
- 5-Year CAGR: 13.6%
- 10-Year CAGR: 17.5%
Who Can Invest?
- Investors looking for long-term wealth creation.
- Those comfortable with temporary underperformance during certain market phases.
- Investors who appreciate a disciplined investment philosophy.
Risk Factors
- Returns may vary depending on market cycles.
- Value-oriented investing requires patience.
- Equity investments remain subject to market risks.
Do you know this fund generated 1% returns in last 1 year you might be wondering why Parag Parikh Flexicap Fund is underperforming? Check out our earlier article on this.
15) ICICI Prudential Value Fund
Fund Objective
ICICI Prudential Value Fund follows a value investing strategy by identifying fundamentally strong companies that are trading below their intrinsic value. The objective is to generate long-term capital appreciation by investing in businesses with the potential for future re-rating.
Annualised Returns
- 3-Year CAGR: 14.6%
- 5-Year CAGR: 16.4%
- 10-Year CAGR: 15.0%
Who Can Invest?
- Investors who believe in value investing.
- Long-term investors with patience to remain invested across market cycles.
- Investors seeking diversification within their equity portfolio.
Risk Factors
- Value investing strategies may underperform during momentum-driven markets.
- Some stocks may remain undervalued for extended periods.
- Equity market volatility can impact short-term returns.
Things to Consider Before Investing in These Mutual Funds
Before investing in any of these wealth builder mutual funds, keep the following points in mind:
- A 5-Star Rating reflects a fund’s historical risk-adjusted performance and should not be the only factor for selecting a mutual fund.
- Evaluate whether the fund’s investment objective aligns with your financial goals.
- Consider your investment horizon. Equity mutual funds are generally more suitable for investors with a horizon of at least five years.
- Assess your risk appetite before investing in categories such as Flexi Cap, Large & Mid Cap or Value Funds.
- Review the fund’s portfolio, expense ratio, consistency of returns and fund management team.
- Investing through a Systematic Investment Plan (SIP) can help reduce the impact of market volatility over the long term.
Disclaimer : This article is published purely for educational and informational purposes and should not be construed as investment advice or a recommendation to buy, sell or hold any mutual fund scheme. Mutual fund investments are subject to market risks. Please read all scheme-related documents carefully before investing. Past performance and Value Research ratings may not be sustained in the future and do not guarantee future returns. Investors should consult a qualified financial advisor if required and invest based on their financial goals, risk appetite and investment horizon.
