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Best International Mutual Funds For 2021

This blog contains a list of the best international funds for 2021. Find out more about the types of international mutual funds in India and how you can invest in them.
October 20, 2021

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[Updated on 15th October 2021]

Picking stocks on your own can be challenging especially when it comes to international companies because there are too many options and factors that you need to evaluate.  

However, there’s a solution: International mutual funds! In this blog, we’ll walk you through some fundamentals and share some of the best international funds currently being recommended on Cube Wealth. 

What Are International Mutual Funds?

International funds are Indian equity funds that invest in the shares of foreign companies like Apple, Amazon, Barclays, Deutsche Bank, Fiat, Novartis, etc. 

International mutual funds ensure that you do not have to deal with the time-consuming and complex task of picking individuals foreign stocks on your own. 

A fund manager does that for you with the fund’s portfolio of international holdings. But that’s not all. Investing in an international fund is as easy as investing in any other mutual fund. 

Other highlights of international funds:

  • You don’t need a brokerage account
  • There’s no LRS requirement
  • Historical returns of 16-20%
  • Low minimum investment amount

Type Of International Mutual Funds

Broadly speaking, international funds are of 3 main types based on where they invest in. Furthermore, there are 3 subgroups of top international mutual funds based on how they invest. 

3 Types Of International Mutual Funds In India (Where They Invest)

This group includes global, regional, and sectoral international mutual funds. 

1. Global International Funds

The term global international funds may seem like a tautology but there’s a reason for that. Global funds invest in stocks from across the world and not just one country. 

For example, PGIM India Global Equity Opportunities Fund invests in stocks from the USA, France, Singapore, Netherlands, Switzerland, and more through the PGIM Jennison Global Equity Opportunities Fund.

2. Regional International Funds

Regional international mutual funds are the opposite of global funds. They invest in the stock market of only one country or region. Index funds are a great example. 

They track one index from a single market (country). For example, Motilal Oswal S&P 500 Index Fund, which invests in all the stocks from the US index S&P 500.

3. Sectoral International Funds

Thematic or sectoral funds are highly specialised funds that look to gain from the benefits of a specific sector. For example, healthcare, power, consumer durables, and others. 

3 Types Of International Mutual Funds In India (How They Invest)

There are 3 main types of international funds apart from the typical international funds that buy and sell stocks directly. These include index funds, fund of funds, and feeder funds. 

1. Index Funds

International index funds track a particular index like the S&P 500 or FTSE 100. Their portfolio will mirror the index they’re tracking. For example, an S&P 500 index fund will include all stocks from the index.

Index funds, in general, look to generate returns that are on par with the market. Furthermore, most index funds are passively managed so their investment fee is known to be relatively low. 

2. Fund Of Fund

An international fund of fund scheme invests in the units of another mutual fund instead of buying and selling stocks itself. It’s important to note that fund of fund schemes can invest in multiple mutual funds. 

An example of an international fund of fund scheme in India includes Edelweiss Greater China Equity Off-shore Fund. It invests in the units of the JPMorgan Funds - Greater China Fund. 

3. Feeder

In principle, an international feeder fund is similar to a fund of fund scheme but with one main difference - it only has one parent fund known as the master fund. 

A feeder fund basically transports money that’s pooled from several investors to the master fund. For example, Franklin India Feeder - Franklin U.S. Opportunities Fund.

Top 7 Best International Mutual Funds For 2021

Wealth First, Cube's mutual fund advisory partner, handpicks the best international funds for you on the Cube Wealth app. 

1. Edelweiss Greater China Equity Off-shore Fund

This international fund invests in another mutual fund, the JPMorgan Funds - Greater China Fund. It’s a fund of fund scheme that gives you access to top-performing Chinese stocks like Alibaba and Tencent.

  • Type: Fund of fund
  • AUM: ₹1,845 crores
  • 1-Year Returns: 50.31%
  • 3-Year Returns: 23.00%
  • 5-Year Returns: 24.75%

As you know, Edelweiss Greater China Equity Off-shore Fund only invests in the JPMorgan Funds - Greater China Fund. However, let’s take a look at the top 5 holdings in the portfolio of the offshore fund. 

  • Taiwan Semiconductor
  • Tencent
  • Alibaba
  • AIA
  • Meituan

2. Franklin India Feeder - Franklin U.S. Opportunities Fund

This is an international feeder fund that feeds money into the Franklin U.S. Opportunities Fund. The underlying fund gives you access to top-performing US stocks like Microsoft, Google, Tesla, and more.

  • Type: Feeder fund
  • AUM: ₹3,837 crores
  • 1-Year Returns: 29.13%
  • 3-Year Returns: 21.72%
  • 5-Year Returns: 20.83%

Let’s take a look at the top 5 holdings in the portfolio of the master fund, Franklin U.S. Opportunities Fund.

  • Adobe Inc
  • Alphabet Inc
  • Amazon Inc
  • American Tower Corporation
  • Analog Devices Inc

3. PGIM India Global Equity Opportunities Fund

This is a global fund of fund that invests in PGIM Jennison Global Equity Opportunities Fund. the underlying fund holds stocks from across countries like Brazil, Singapore, the USA, England, and more.

  • Type: Fund of fund
  • AUM: ₹1,517 crores
  • 1-Year Returns: 31.20%
  • 3-Year Returns: 27.03%
  • 5-Year Returns: 10.51%

Let’s a look at the top 5 holdings of the underlying fund, the PGIM Jennison Global Equity Opportunities Fund.

  • Tesla Inc
  • Sea Ltd
  • Apple Inc
  • Adyen
  • MercadoLibre Inc

4. Motilal Oswal S&P 500 Index Fund

This is an index fund that tracks the S&P 500. It mirrors the US index and includes stocks like Apple, Amazon, Google, Netflix, Microsoft, and more. 

  • Type: Fund of fund
  • AUM: ₹2,145 crores
  • 1-Year Returns: 29.90%

Let’s look at the top holdings of the Motilal Oswal S&P 500 Index Fund.

  • Apple Inc
  • Microsoft Corporation 
  • Amazon. com Inc
  • Vanguard S&P 500 ETF
  • Facebook 

5. Nippon India Japan Equity Fund

This international fund invests in the Japanese stock market. That’s not all, a part of the portfolio is also invested in debt and money market assets in India. 

  • Type: International fund
  • AUM: ₹228 crores
  • 1-Year Returns: 23.19%
  • 3-Year Returns: 11.06%
  • 5-Year Returns: 10.95%

Let’s look at the top 5 holdings in the portfolio of Nippon India Japan Equity Fund.

  • Fast Retailing
  • Hitachi
  • Mitsui Fudosan Co
  • Mitsubishi UFJ Financial Group
  • Toyota Motor Corporation

6. Motilal Oswal Nasdaq 100 Fund Of Fund

Motilal Oswal Nasdaq 100 Fund of Fund invests in the Motilal Oswal Nasdaq 100 ETF, which makes it a fund of fund scheme. Motilal Oswal Nasdaq 100 ETF mirrors the Nasdaq 100 index.

  • Type: Fund of fund
  • AUM: ₹2,602 Cr
  • 1-Year Returns: 34.65%

Let’s look at the top 5 holdings in the portfolio of Motilal Oswal NASDAQ 100 ETF Fund.

  • Apple Inc
  • Microsoft Corporation 
  • Amazon. com Inc
  • Tesla Inc
  • Alphabet Inc Class C

7. Invesco Pan European Equity Fund

This fund allows investors to take part in the growth of the European market. Invesco Pan European Equity Fund invests in high growth European companies.

  • Type: International fund
  • AUM: ₹24 Cr
  • 1-Year Returns: 36.54%
  • 3-Year Returns: 4.94%
  • 5-Year Returns: 7.85%

Let’s look at the top 5 holdings in the portfolio of Invesco Pan European Equity Fund.

  • Roche NES
  • Sanofi
  • Total
  • UPM-Kymmene
  • Deutsche Post

How To Invest In International Mutual Funds?

Investing in international funds is as simple as investing in any other mutual fund. This means that you have two options:

1. Buy International Funds Using Investment Apps

Intermediaries like investment apps allow you to buy regular international mutual funds. Regular international mutual funds typically have a higher expense ratio than direct international mutual funds. But they're ideal for busy professionals who have no time to for in-depth research.

2. Buy International Funds From AMC

AMCs offer a way to buy "direct" international mutual funds. The investment cost, mainly the expense ratio, for direct mutual funds is lower than regular mutual funds.

However, you'll have to do the research yourself and pick international funds that suit your investment portfolio.

Here's how handpicked mutual funds work on the Cube Wealth app

Note: Facts & figures are true as of 15-10-2021. All information mentioned is for educational purposes and relies on publicly available information. None of the information shared here is to be construed as investment advice. We strongly recommend you consult a Cube Wealth coach before investing your money in any stock, mutual fund. PMS or alternative asset.


Shriram Shekhar
Shriram is a Content Marketer at Cube Wealth, the Financial Freedom App with a smart Perfect Portfolio Planner. He has developed cutting edge IT products for over 2 years before turning to his passion for the written word. Shriram’s love for philosophy, product development, and empowering people through quality content is what got him to Cube Wealth.

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