Best and Worst Performing NPS Funds in 2017

Best and Worst Performing NPS Funds in 2017Best and Worst Performing NPS Funds in 2017


While there are several ways to plan for retirement, NPS is considered as one of the best way to save for retirement. NPS Funds has been performing well in the recent years. Some of the Good NPS Funds gave upto 15% returns in last 1 year. NPS funds are gaining popularity considering additional tax benefit of Rs 50,000 over and above 80C. Which are the best NPS funds that are rocking now? Which are the best and worst performing NPS Funds in 2017? Who is the best NPS Fund Manager in 2017?

What is New Pension Scheme / National Pension Scheme (NPS)?


If you are already aware of this, skip this section.

National Pension Scheme (NPS) is a government approved pension scheme for Indian citizens in the age group of 18 to 60 years. Apart from Central and State Government employees, others too can subscribe to this NPS. This is one of the good retirements saving scheme.

Also Read: How to Open New Pension Scheme (NPS) Online?

What are various asset classes available in NPS?


It has 3 asset classes:

a) Equity plans (Class E) – Which invests predominantly in equity related instruments. This is high risk-high return option. Good for high risk investors.

b) Govt bond plans (Class G) – This NPS fund invests in Govt securities like govt bonds, etc., It is low risk-low return option. Good for low risk investors.

c) Corporate bond plans (Class C) – Which invests in securities other than govt securities. This is medium risk-medium return option. Good for moderate risk investors.

What are the accounts available under NPS?


There are 2 accounts which are offered as part of NPS Scheme. Tier-I account and Tier-II account.

Tier-I – Investments can be made into this account, however, it has restriction in terms of withdrawal of the funds from this account.

Tier-II – Investments can be made into this account without any restrictions on withdrawal of the funds from this account.

Apart from above, there is a Swavalamban NPS scheme / NPS Lite for Govt. employees.

Best and Worst Performing NPS Funds in 2017


Here are the list of best and worst performance of NPS Funds in 2017. Data source is from valueresearchonline.

Performance of Tier-I Account of NPS


Tier-I – Equity Plans


Best NPS Funds for 2017-Tier-1-Equity-Plans

1) UTI Retirement Solutions is the best performer in this category. This generated 24% returns in last 1 year and 14.69% annualized returns in last 5 years.  If one would have invested Rs 5,000 per month through SIP for 3 years, the investment amount would have been Rs 1.8 Lakhs (5,000 x 36) and your fund value would have grown to Rs 2.1 Lakhs.  If one would have invested Rs 5,000 per month through SIP for 5 years, the investment amount would have been Rs 3 Lakhs (5,000 x 60) and your fund value would have grown to Rs 4.2 Lakhs.

2) In short term, Reliance Capital Pension Fund and HDFC Pension Fund have given good returns.

3) LIC Pension Fund is the worst fund in this category which gave 8.6% returns in last 1 year and 12.8% annualized returns in last 3 years.

Tier-I – Government Bond Plan


Best NPS Funds for 2017-Tier-1-Govt Bond Plans

1) LIC Pension Fund is the best performer in this category. This generated 12.8% returns in last 1 year and 13.2% annualized returns in last 3 years.  If one would have invested Rs 5,000 per month through SIP for 3 years, the investment amount would have been Rs 1.8 Lakhs (5,000 x 36) and your fund value would have grown to Rs 2.11 Lakhs. 

2) ICICI Pension Fund too performed well in long run of 5 years.

3) UTI Retirement Solutions is the worst fund in this category which gave 10% returns in last 1 year and 10.3% annualized returns in last 5 years.

Tier-I – Corporate Debt Plans


Best NPS Funds for 2017-Tier-1-Corp Debt Plans

1) ICICI Prudential Pension Fund is the best performer in this category. This generated 10.8% returns in last 1 year and 11.3 % annualized returns in last 5 years. One should note that there is still an element of risk in these plans. Instances like Jindal Steel & Power debt instruments etc., downgrading could have an impact in the future as such funds invests in corporate debt plans.

2) UTI Retirement Solutions is the worst performer in this category. This generated 10.5% returns in last 1 year and 10.7% annualized returns in last 5 years.

Tier-II – Equity Plans


Best NPS Funds for 2017-Tier-II-Equity-Plans

1) UTI Retirement Solutions is the best performer in this category. This generated 23.4% returns in last 1 year and 14.6% annualized returns in last 5 years.  If one would have invested Rs 5,000 per month through SIP for 3 years, the investment amount would have been Rs 1.8 Lakhs (5,000 x 36) and your fund value would have grown to Rs 2.11 Lakhs.  If one would have invested Rs 5,000 per month through SIP for 5 years, the investment amount would have been Rs 3 Lakhs (5,000 x 60) and your fund value would have grown to Rs 4.22 Lakhs.

2) In short term, Reliance Capital Pension Fund and HDFC Pension Fund have given good returns.

3) LIC Pension Fund is the worst fund in this category which gave 22% returns in last 1 year and 11% annualized returns in last 3 years.

Tier-II – Government Bond Plan


Best NPS Funds for 2017-Tier-II-Govt Bond Plans

1) LIC Pension Fund is the best performer in this category. This generated 12 % returns in last 1 year and 12.7% annualized returns in last 3 years.  If one would have invested Rs 5,000 per month through SIP for 3 years, the investment amount would have been Rs 1.8 Lakhs (5,000 x 36) and your fund value would have grown to Rs 2.1 Lakhs. 

2) ICICI Pension Fund too performed well in long run of 5 years.

3) UTI Retirement Solutions is the worst fund in this category which gave 10.4% returns in last 1 year and 10.6% annualized returns in last 5 years.

Tier-II – Corporate Debt Plans


Best NPS Funds for 2017-Tier-II-Corp Debt Plans

1) ICICI Prudential Pension Fund is the best performer in this category. This generated 10.7% returns in last 1 year and 11.1 % annualized returns in last 5 years. One should note that there is still an element of risk in these plans. Instances like Jindal Steel & Power debt instruments etc., downgrading could have an impact in the future as such funds invests in corporate debt plans.

2) SBI Pension Fund is the worst performer in this category. This generated 10.2% returns in last 1 year and 10.1% annualized returns in last 5 years.

Also Read: What are the benefits of New Pension Scheme (NPS)?

Who is the Best NPS Fund Manager?


It is very difficult to say about who is the best NPS Fund manager as there is mixed performance across various categories.

  • If you are looking for Equity NPS Funds, UTI Retirement Solutions and SBI Pension Fund are better.
  • If you are looking for Govt Bonds NPS Funds, ICICI Pension Fund and LIC Pension fund are good.
  • If you are looking for Corp Debt Plan NPS Funds, ICICI Pension Fund and Kotak Pension Fund are best.

Conclusion: NPS Investors have freedom to choose Schemes. In Retirement planning we should not look for short term performance. Consider the long term performance and invest in good NPS Funds. Choosing a right fund manager can help you to get superior returns in NPS in the long run.

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Suresh

Best and Worst Performing NPS Funds in 2017

7 comments

  • pasha

    Shall i invest for 10 yrs. then i can opt for pension.?

  • Mukul

    Do i get tax benefits in tier-2 account also where there are no restrictions on the withdrawals?

  • Rahul

    Hello Suresh,

    What can be the minimum investment for NPS Tier1 & Tier2 account? and can we invest monthly, just like PPF 

    Thank you for your valuable time.

    • Yes you can invest like PPF. The minimum amount for Tier-1 Account is Rs 1,000 per annum. However, there is no minimum amount for Tier-2 Account.

  • Supriya Bhattacharya

    Dear sir, I am a subscriber of NPS. I am 27 years old. I choose aggressive auto mode where 75 equity, 10 corp and 15 govt. There is a rule that I can choose any one AMC. I choose uti as my AMC. Is my selection is right or wrong? Thanks

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