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10 Mutual Funds That Have Consistently Outperformed The Market

In this fast growing economy there has been a huge increase in the number of mutual funds and equity schemes that are available for investors to choose from. In this blog we will get an in-depth knowledge of Top 10 Mutual Funds that have consistently outperformed the market.
April 18, 2024

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Mutual Funds in India are a great way to invest your money and grow it. Mutual funds are basically a pool of money that you can invest in. You don't actually own stock, but instead, buy shares in a fund that manages the money and pays out dividends based on the performance of the underlying assets. However, they do come with their own set of risks and pitfalls.

Mutual funds are investment vehicles that invest in stocks, bonds, money market instruments, and other securities. Mutual funds are professionally managed by fund managers who choose the securities to be held by the mutual fund over a specified period of time, normally ranging from days to years. The fund manager/investment advisor attempts to maximize returns while managing risk within the portfolio. 

1. Quant Small Cap Fund

The Quant Small Cap Fund Direct Plan Growth has been there from 07 Jan 2013 and the average annual returns provided by this fund is 10.72% since its inception. The primary investment objective of the scheme is to seek to generate capital appreciation & provide long-term growth opportunities by investing in a portfolio of Small Cap companies. There is no assurance that the investment objective of the Scheme will be realised.

  • Risk: High
  • 1-Year Returns: 14.46%
  • 3-Year Returns: 54.77%
  • 5-Year Returns: 23.38%
  • AUM: ₹2,870.43 crores

2. Quant Tax Plan

The Quant Tax Plan Direct Growth has been there from 07 Jan 2013 and the average annual returns provided by this fund is 7.75% since its inception. The investment objective of the Scheme is to generate Capital Appreciation by investing predominantly in a well diversified portfolio of Equity Shares with growth potential. This income may be complemented by possible dividends and other income. 

  • Risk: High
  • 1-Year Returns: 10.81%
  • 3-Year Returns: 40.07%
  • 5-Year Returns: 20.98%
  • AUM: ₹2,506.48 crores

3. Quant Active Fund

The Quant Active Fund Direct Growth has been there from 07 Jan 2013 and the average annual returns provided by this fund is 4.82% since its inception. The primary investment objective of the scheme is to seek to generate capital appreciation & provide long-term growth opportunities by investing in a portfolio of Large Cap, Mid Cap and Small Cap companies. There is no assurance that the investment objective of the Scheme will be realised.

  • Risk: Medium
  • 1-Year Returns: 8.95%
  • 3-Year Returns: 36.72%
  • 5-Year Returns: 19.47%
  • AUM: ₹3,544.03 crores

4. PGIM India Midcap Opportunities Fund

The PGIM India Midcap Opportunities Fund Direct Growth has been there from 02 Dec 2013 and the average annual returns provided by this fund is 3.94% since its inception. The scheme seeks to achieve long-term capital appreciation by predominantly investing in equity & equity related instruments of mid cap companies.

  • Risk: High
  • 1-Year Returns: 7.22%
  • 3-Year Returns: 33.03%
  • 5-Year Returns: 17.22%
  • AUM: ₹7,557.96 crores

5. ICICI Prudential India Opportunities Fund

The ICICI Prudential India Opportunities Fund Direct Growth has been there from 15 Jan 2019 and the average annual returns provided by this fund is 13.94% since its inception. The scheme seeks to generate long-term capital appreciation by investing in opportunities presented by special situations such as corporate restructuring, Government policy and/or regulatory changes, companies going through temporary unique challenges and other similar instances.

  • Risk: Medium
  • 1-Year Returns: 16.16%
  • 3-Year Returns: 31.47 %
  • 5-Year Returns: NA
  • AUM: ₹7,224.58 crores

6. Kotak Small Cap Fund

The Kotak Small Cap Fund Direct Growth has been there from 01 Jan 2013 and the average annual returns provided by this fund is 2.44% since its inception. The scheme seeks to generate capital appreciation from a diversified portfolio of equity and equity related securities by investing predominantly in small cap companies.

  • Risk: High
  • 1-Year Returns: 5.84%
  • 3-Year Returns: 31.46%
  • 5-Year Returns: 15.90%
  • AUM: ₹8,498.04 crores

7. ICICI Prudential Small Cap Fund

The ICICI Prudential Small Cap Fund Direct Plan Growth has been there from 02 Jan 2013 and the average annual returns provided by this fund is 9.84% since its inception. The primary objective of the Scheme is to seek to generate capital appreciation by predominantly investing in equity and equity related securities of small cap stocks.

  • Risk: High
  • 1-Year Returns: 2.9%
  • 3-Year Returns: 32.1%
  • 5-Year Returns: 11.7%
  • AUM: ₹4,598.77 crores

8. HDFC Flexi Cap Fund

The HDFC Flexi Cap Direct Plan Growth has been there from 01 Jan 2013 and the average annual returns provided by this fund is 13.77% since its inception. The scheme follows an equity strategy to build a portfolio, representing a cross section of companies diversified across major industries, economic sectors and market capitalization that offer an acceptable risk reward balance. You can consult a Cube Wealth Coach or download the Cube Wealth App.

  • Risk: Medium
  • 1-Year Returns: 19.17%
  • 3-Year Returns: 26.71%
  • 5-Year Returns: 13.64%
  • AUM: ₹32,154.52 crores

9. HDFC large and Midcap Fund

The HDFC Large and Mid Cap Fund Direct Growth has been there from 01 Jan 2013 and the average annual returns provided by this fund is 8.36% since its inception.  The Scheme aims to generate long term capital appreciation/income from a portfolio of equity and equity related securities of predominantly large cap and midcap companies.

  • Risk: Medium
  • 1-Year Returns: 13.5%
  • 3-Year Returns: 25.64%
  • 5-Year Returns: 12.98%
  • AUM: ₹7,865.66 crores

10. Kotak Emerging Equity Fund

The Kotak Emerging Equity Fund Direct Growth has been there from 01 Jan 2013 and the average annual returns provided by this fund is 9.57% since its inception. The investment objective of Kotak Emerging Equity Fund is to generate long-term capital appreciation from a portfolio of equity and equity related securities, by investing predominantly in midcap companies. These companies are either at their nascent or developing stage and are under researched.

  • Risk: High
  • 1-Year Returns: 13.41 %
  • 3-Year Returns: 25.14%
  • 5-Year Returns: 14.23%
  • AUM: ₹23,334.64 crores

FAQs

1. Do mutual funds outperform the market?

Ans. A mutual fund provides diversification through exposure to a multitude of stocks. The reason that owning shares in a mutual fund is recommended over owning a single stock is that an individual stock carries more risk than a mutual fund. Whether stocks or mutual funds are better for your portfolio depends on your personal goals and risk tolerance. For many investors, it can make sense to use mutual funds for a long-term retirement portfolio, where diversification and reduced risk might be more important. You can consult a Cube Wealth Coach or download the Cube Wealth App.

2. Should an investor expect a mutual fund to outperform the market?

Ans. Mutual funds may be a good investment for anyone looking for diversification in their portfolios. Learn whether mutual funds can be the right investment for you or not. One should not expect any fund to outperform the market because due to market fluctuations the fund rate changes from time to time.

3. Do wealth managers outperform the market?

Ans. Decades of data show that individual advisors, even the highest paid, do not consistently beat the market indexes. Plus their advice is expensive, which reduces your investable assets each year, resulting in lower long-term returns.

4. Why do mutual funds underperform the market?

Ans. Active mutual funds on average (and net of fees) underperform the index because they have less inside information than promoters of companies. The underperformance rates remain high because active managers historically have had higher costs than passive managers. Because stocks are not normally distributed, active portfolios are often hindered by the dominant winners in equity markets.

Conclusion 

Consistently outperforming the market is a challenging feat for any investment, but these ten mutual funds have demonstrated a strong track record of doing so. Their ability to deliver above-average returns over an extended period is a testament to the expertise of their fund managers and the strategies they employ. However, past performance does not guarantee future results, and investors should approach these funds with careful consideration. When selecting mutual funds, it's crucial to align them with your financial goals, risk tolerance, and investment horizon. Diversification and regular portfolio reviews are also essential components of a successful investment strategy. Consulting with a financial advisor can provide valuable insights to help you make informed decisions and potentially achieve superior returns in the long term. You can consult a Cube Wealth Coach or download the Cube Wealth App.

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