Nifty 50 index generated 3.8% returns and Nifty 100 index generated 1.5% returns in the last 1 year. However, there are several mutual funds which have outperformed in the last 1 year. While one need not go with short term performance, it can give direction to the investors about investing. Mrs. Apurva, one of our blog readers wants to filter funds based on last 1 year performance and wanted guidance on this. In this article, we would provide 5 Equity Mutual Funds that generated returns up to 24% in the last 1 year and our view about such funds.
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What is the query?
Mrs. Apurva Trivedi, one of our blog readers emailed “Suresh, I want to filter mutual funds that generated the highest returns in the last 1 year. Can I pick-up from top 5 funds and invest in lumpsum or through SIP. Is it a right or wrong decision?
There is nothing wrong with this approach. However, short term approach sometimes may be misleading. While one should invest based on their financial goal, tenure of investment and risk appetite, picking up funds based on short term performance can sometimes lead to disaster. Let me filter these top 5 funds based on last 1 year returns and provide our view.
How we filtered these mutual funds?
- We have considered all equity mutual funds including sector funds and direct plans.
- Further filtered funds that generated top 5 highest returns.
- Excluded ETFs from this list.
- When we picked these 5 mutual funds based on highest returns in last 1 year, surprisingly there are 3 mutual funds from ICICI MF, 1 Quant Fund and 1 Kotak MF.
List of 5 Equity Mutual Funds with 1 Year Return up to 24%
Here is the list.
#1 – ICICI Prudential Infrastructure Fund
#2 – ICICI Prudential BHARAT 22 FOF
#3 – Quant Quantamental Fund
#4 – ICICI Prudential FMCG Fund
#5 – Kotak Infrastructure and Economic Reform Fund
5 Equity Funds with 1 Year Return up to 24% – Detailed View
#1 – ICICI Prudential Infrastructure Fund
This fund aims to generate capital appreciation and income distribution to unit holders by investing predominantly in equity/equity related securities of the companies belonging to the infrastructure theme.
Performance of the Fund
1 Year Return – 24%
3 Year Annualised Returns – 28%
5 Year Annualised Returns – 14%
10 Year Annualised Returns – 15%
Our View: This mutual fund invests in Infrastructure and infra related companies. This sector majorly depends on the govt allocation of budgets towards infrastructure development. We could see higher govt spending on infrastructure in the last 5 to 10 years and we expect that it would continue in future too. This fund generated 15% annualised returns since inception. This is a sector mutual fund, hence one can invest some portion of their portfolio in such funds.
#2 – ICICI Prudential BHARAT 22 FOF
This FOF aims to generate returns by investing in units of BHARAT 22 ETF.
Bharat 22 ETF is an open-ended exchange traded fund investing in 22 companies, including 3 private sector stocks and 19 public sector units (PSUs) listed in the S&P BSE Bharat 22 Index. The scheme was launched by the Government of India to fulfill its disinvestment target in PSUs.
Performance of the Fund
1 Year Return – 23%
3 Year Annualised Returns – 22%
Our View: This mutual fund invests in Bharat 22 index which has 3 private sector companies and 19 PSUs. If you observe earlier, the majority of the PSU stocks are disappointing investors with not much growth in stock price, however generated high dividend yield. These stocks have become a favorite for investors in the last 9 months to 1 year. This could be a temporary cycle for short term and I would avoid investing in such themes for a medium to long term.
#3 – Quant Quantamental Fund
The investment objective of the scheme is to deliver superior returns as compared to the underlying benchmark over the medium to long term through investing in equity and equity related securities.
Performance of the Fund
1 Year Return – 23%
Our View: This fund was launched less than 2 years back and generated 21% annualised returns since inception.
The portfolio of stocks will be selected, weighed and rebalanced using stock screeners, factor based scoring and an optimal formula which aims to enhance portfolio exposures to factors representing, good investing principles‟ such as growth, value and quality within risk constraints.
Again, this is a thematic mutual fund, hence one can invest some portion of their portfolio in such funds.
#4 – ICICI Prudential FMCG Fund
This fund aims to generate long term capital appreciation through investments made primarily in equity & equity related securities forming part of the FMCG sector.
Performance of the Fund
1 Year Return – 23%
3 Year Annualised Returns – 17%
5 Year Annualised Returns – 14%
10 Year Annualised Returns – 15%
Our View: This mutual fund invests in FMCG which is ever green sector. This fund generated 15% annualised returns since inception. Again, this is a sector mutual fund, hence one can invest some portion of their portfolio in such funds.
Also Read: Best Largecap Funds to invest in 2023
#5 – Kotak Infrastructure and Economic Reform Fund
The investment objective of the Scheme is to generate long-term capital appreciation from a diversified portfolio of predominantly (at least 65%) equity and equity-related securities of companies involved in economic development of India as a result of potential investments in infrastructure and unfolding economic reforms
Performance of the Fund
1 Year Return – 22%
3 Year Annualised Return – 25%
5 Year Annualised Return – 13%
10 Year Annualised Return – 18%
Our View: This mutual fund invests in Infrastructure and infra related companies and generated 18% annualised returns since inception. Like I indicated in earlier section, this sector majorly depends on the govt allocation of budgets towards infrastructure development. This is a sector mutual fund, hence one can invest some portion of their portfolio in such funds.
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Suresh, I want to know how HDFC Multicap Direct Growth fund and SBI Bluechip Regular Growth fund will perform in the long run, say 20 – 22 years.
Both are good, you can continue
Sir i have lumpsum amountof15 lkh and iwant regular income and sawe my principal amount also
Sir, i want to invest in such mutual fund or SIP where it should help for tax benefits and which would fetch high dividends monthly.. Kindly assist me in this matter