This Mutual Fund generated Highest SIP Returns in 5 years

September 24, 2022 Suresh KP

Recently we reviewed 10 mutual funds that generated highest SIP returns in 10 years. Mr. Raghav, one of our readers would like to know the mutual fund scheme that generated highest SIP returns in 5 years and whether he can invest in such fund now or not. 5 years time frame is medium term, hence it is a genuine question that might come to investors mind whether one can assess performance based on 5 years time frame. In this article we would provide complete details about the mutual fund scheme that generated highest SIP returns in the last 5 years.

Also Read: High Return Mutual Funds to invest in 2022-23

Table of Contents

How we filtered this mutual fund scheme?

We considered all equity mutual fund schemes excluding sector funds. Means this includes large cap funds, mid cap funds, small cap funds, balanced funds and index funds.

Filtered fund that generated highest SIP returns in the last 5 years among direct mutual funds.

Quant Small Cap Fund stands out 1^st in the list after applying these filters.

This fund generated highest SIP returns of 36.75% in the last 5 years while 3 more quant funds generated between 31% to 35% returns during a similar period.

About Quant Small Cap Fund

The investment objective of the MF is to generate capital appreciation & provide long-term growth opportunities by investing in a portfolio of small cap companies.

One can invest a minimum of Rs 5,000 in lump sum or Rs 1,000 through SIP.

While there is no entry load, there is an exit load of 1% if redeemed before 1 year.

This fund allocates 65% to 100% in small cap companies, up to 35% in large cap and mid cap companies, up to 35% in debt and money market instruments and up to 10% in REITs and InvITs.

Since this is a small cap fund, this is categorized as very high risk fund.

Current AUM is Rs 2,079 Crores.

Its current expense ratio is 0.62%.

Where does this mutual fund invest now?

While this fund invests majorly in small cap companies, here are the portfolio details.

This fund majorly invests in sectors of consumer staples, services, materials, healthcare, construction, capital goods, financials etc.,

Its concentration is on 58 companies now. Its top holdings are ITC, IRB Infra, Ambuja Cements, Hindustan Copper, India Cements, HFCL, Arvind, Linde India, Ruchi Soya, Aegis Lostics, Praj Industries, EID Parry etc.,

Also read: Multibagger mutual funds with 10x returns in 10 years

How is the performance of the fund?

Let us check the performance of SIP, lump sum and rolling returns.

A) SIP Performance

This fund generated 37% SIP returns in last 5 years and 56% SIP returns in last 3 years.
Investment of Rs 10,000 SIP per month, the investment value would have been Rs 6 Lacs (10,000 x 60 months) and the investment value would have now grown to Rs 14.8 Lacs.

B) Annualised Performance

7 year annualized returns – 19%
5 year annualized returns – 23% (investment of 1 lac would have turned 2.8 lacs)
3 year annualized returns – 53%
1 year returns – 12%

C) Rolling Returns

From a 3 year rolling return perspective, this fund generated:

Over 12% returns – 60% of the times
1% to 12% returns – 14% of the times
Negative returns – 26% of the times

From a 5 year rolling return perspective, this fund generated:

Over 12% returns – 29% of the times
1% to 12% returns – 51% of the times
Negative returns – 20% of the times

If we also observe, this fund generated 16% annualised returns since inception of the mutual fund scheme.

This fund is able to generate 2% to 4% higher returns in last 5 years compared to its peer small cap mutual fund schemes.

Who can invest in this smallcap fund?

Earlier we analyzed 10 mutual fund schemes that generated highest SIP returns in 10 years which includes various market cap categories.

Mutual funds can perform better in medium to long term. This mutual fund scheme is small cap fund and is very high risk. Smallcap or midcap segment can outperform in long term and may or may not perform well in short to medium term.

Don’t carry away with such high SIP returns of this fund.

If you are a high risk investor and want to invest for a medium to long term, you can invest in such funds. You need to have patience in case such mutual funds underperform in short to medium term. You should invest in a diversified portfolio of mutual funds consisting of large cap midcap and smallcap funds so that underperformance of one segment should not affect your portfolio.

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Suresh KP

Suresh KP is the Founder of Myinvestmentideas. He is NISM Certified - Investment Adviser and NISM Certified - Research Analyst. He has been analyzing financial markets in the last 20 years.He can be reached at suresh@myinvestmentideas.com