Mutual Fund investments are undertaken to fulfill a common financial goal of the investors. Their money, once collected, is invested in different asset classes. Because the funds are well-diversified, they tend to offset potential losses. In the present investment scenario,  Mutual Funds are the best tools for the creation of wealth and achieve your financial goals.

The amount required to invest in mutual funds is comparatively lesser than other instruments. This makes it easily the most popular manner to earn extra and optimize your investments.

However, with so many kinds of mutual funds available in the market, it gets very difficult to be sure about how and which one to choose, to avail of the best Mutual Funds Benefits. Which fund is the most appropriate based on your needs and budget? If somehow, you have made a wrong selection, the amount you have put in, is wasted. Otherwise, if you keep it going, it brings discontent and unhappiness. Most options come with a condition of keeping the investment until, at least, a period of 5 years.

Due to this, it is advisable to invest in the Mutual Fund options that have been doing well consistently. For this same purpose, we are discussing and providing a peek into the best mutual fund investment options available in India. You can pick the one that suits your risk appetite and investment goals. You can take the help of the various Mutual Funds Calculator available online, to have an overview. It helps in calculating how much you need to invest, whether to invest via best SIP or Lump Sum and optimal duration, etc.

In this article, we have summarised the top mutual funds in all the categories, that suit the risk appetite and investment goals of most of the investors.

Top 5 Large-Cap Equity Funds

Equity Mutual Funds have over two-thirds of their corpus invested in equity and the balance in debt. Need at least a three-year holding period. Listed below are 5 of the top-performing Large-Cap Equity Funds, as of 31 December 2018:

Fund Name1-Year Return3-Year Return5-Year Return
Reliance Large Cap Fund8.24%16.91%16.83%
HDFC Top 100 Direct-G11.62%16.58%14.39%
Axis Bluechip Direct-G9.38%15.26%14.62%
ICICI Prudential Blue Chip Fund5.03%14.50%14.49%
Indiabulls Bluechip Direct-G3.13%13.84%13.06%

Top 5 Small-Cap Equity Mutual Funds Investment

Funds that have the potential to generate higher returns. These also have high risks and volatility. They require a minimum holding period of five years and an active review of performance. Listed below are some of the top-performing Small-Cap Equity Funds, as of 31 December 2018:

Fund Name1-Year Return3-Year Return5-Year Return
L&T Emerging Businesses Direct-G-14.82%19.18%
HDFC Small Cap Fund Regular-Growth-10.28%18.38%18.9%
Reliance Small Cap Direct-G-15.24%15.95%23.58%
Aditya Birla SL Small Cap Direct-G-19.28%10.88%17.29%
Franklin India Smaller Companies Direct-G-13.47%10.03%18.97%


Top 5 Multi-Cap Equity Funds

The plans that diversify their investments into varying categories are called multi-cap funds. By investing in different types of companies, from Blue Chip ones to Small start-ups, these Mutual Funds carry much less risk. If one category doesn’t work well, the other category, usually, offset the losses. Becoming the most suitable scheme for not-so-active investors. Listed below are some of the top-performing Multi-Cap Equity Funds:

Fund Name1-Year Return3-Year Return5-Year Return
Mirae Asset India Equity Fund Direct-Growth8.53%17.35%18.22%
Axis Focused 25 Direct-G0.04%16.87%16.76%
Kotak Standard Multicap Direct-G7.01%16.47%18.66%
Aditya Birla SL Equity Direct-G-0.64%14.93%17.27%
Principal Focused Multi-Cap Growth Fund Direct-Growth3.84%13.20%13.11%

Top 5 Sectoral – Infrastructure Funds

The funds are invested in the companies that are directly or indirectly linked to the creation of infrastructure and benefits in its growth. The Standard Scheme Documents generally, require 65% of the fund’s assets to be invested in this particular theme and provide the fund manager with the leeway to invest the rest 35% elsewhere. Given below are some of the top-performing Sectoral-Infrastructure Funds:

Fund Name1-Year Return3-Year Return5-Year Return
L&T Infrastructure Direct-G-12.28%15.43%17.32%
Taurus Infrastructure Direct-G-8.23%14.43%14.47%
Franklin Build India Direct-G6.7%14.38%21.29%
IDFC Infrastructure Direct-G-19.03%12.49%12.43%
Sahara Infrastructure Variable Pricing-G-1.61%12.09%13.81%

Top 5 Equity Linked Saving Schemes

The investors of such ELSS plans are offered tax exemptions under Section 80C of the Income Tax Act. These are diversified, open-ended Tax Saving Mutual Funds offering higher returns as well. A major portion of the capital is invested in equity funds. The best performing ELSS, as of 31 December 2018, are as follows:

Fund Name1-Year Return3-Year Return5-Year Return
Principal Tax Savings Fund Direct-5.95%15.47%15.78%
Motilal Oswal Long Term Equity Fund Direct-Growth-8.09%15.40%
DSP Tax Saver Direct Plan-Growth2.72%14.78%17.43%
Quant Tax Plan Direct-G0.54%14.12%19.42%
Aditya Birla Sun Life Tax Relief 96-Growth-2.74%13.73%18.40%

Top 5 Debt – Dynamic Bond Mutual Funds Investment

The investments are predominantly made in Debt Funds and Money Market Instruments. Ideal for those investors whose primary investment goal is to generate optimal returns consistent with moderate levels of risk. Listed below are the best performing Debt-Dynamic Bond Funds as of 31 December 2018:

Fund Name1-Year Return3-Year Return5-Year Return
Franklin India Dynamic Accrual Direct-G8.92%9.01%9.73%
ICICI Pru All Seasons Bond Direct-G7.26%8.41%10.05%
Kotak Dynamic Bond Direct-G9.36%8.36%8.79%
DSP Strategic Bond Direct Plan-Growth8.42%6.54%8.18%
DHFL Pramerica Dynamic Bond Direct-G5.6%5.29%6%

Top 5 Debt-Liquid Funds

These Liquid Mutual Funds provide easy liquidity by investing in highly liquid money market instruments. The duration for the best Mutual Funds could be as short as a day. The objective is to earn money market rates. They serve as an alternative to corporate and individual investors, for investing their surplus cash for short periods. Returns on these investments tend to fluctuate less when compared with other funds. The top 5 Debt-Liquid Mutual Funds in India (as of 31 December 2018) are as indicated below:

Fund Name1-Year Return3-Year Return5-Year Return
Reliance Liquid Fund-Growth7.53%7.17%7.72%
HSBC Cash Direct-G7.53%7.14%7.68%
IDBI Liquid Direct-G7.53%7.10%7.64%
BNP Paribas Liquid Direct-G7.42%7.04%7.52%
Franklin India Liquid Direct-G6.96%6.48%7.07%

Top 5 Debt-Short Duration Funds

The mutual fund investment scheme that spans between 1 to 3 years. Although it may extend to four years as well, in some cases. These investments are usually accompanied by stable returns and modest risks, just like bank Fixed Deposits (FDs). The top 5 Debt-Short Duration Mutual Funds in India (as of 31 December 2018) have been listed below:

Fund Name1-Year Return3-Year Return5-Year Return
Franklin India ST Income Direct-G8.74%8.99%8.99%
Baroda Pioneer Short Term Bond Direct-G7.49%7.92%8.39%
ICICI Pru Short Term Direct-G7.87%7.90%9.40%
Aditya Birla SL Short Term Opportunities Direct-G7.58%7.32%8.35%
Axis Short Term Direct-G5.72%5.26%5.78%

Top 5 Debt-Medium Duration Mutual Funds Investment

The  Medium Duration Debt Funds invest predominantly in debt securities that have a maturity of up to 3 years, as compared to a Regular Income Fund/Monthly Income Plan. These funds have an average maturity that is longer than Liquid and Ultra  Short Term Mutual Funds but shorter than Pure Income Funds. The top 5 Debt-Medium Duration Mutual Funds Investment in India (as of 31 December 2018) areas listed below:

Fund Name1-Year Return3-Year Return5-Year Return
Franklin India Income Opportunities Direct-G7.44%8.55%8.78%
Kotak Medium Term Direct-G6.46%7.33%8.51%
DSP Bond Direct-Growth4.91%6.84%8.15%
Aditya Birla SL Medium Term Direct-G3.86%6.55%8.19%
Reliance Strategic Debt Direct-G2.46%6.08%

Top 5 Debt-Medium to Long-Duration Funds

Medium To Long-Duration Mutual Funds Investments is done for a duration of 4 to 7 years. The guidelines for the fund managers in these investments is to reduce portfolio duration to a minimum level of up to 1 year in case of anticipated adverse market conditions. The top 5 Debt-Medium to Long-Duration Funds as of 31 December 2018 have been listed below:

Fund Name1-Year Return2-Year Return5-Year Return
ICICI Pru Advisor Series-Debt Management Direct-G7.02%7.62%9.28%
SBI Magnum Income Direct-G6.43%7.46%8.30%
IDFC Bond Income Direct-G8.43%7.08%8.32%
Reliance Income Direct-G8.73%6.81%8.15%
Canara Robeco Income Direct-G6.38%6.20%7.18%

Top 5 Debt-Gilt Funds

Gilt Funds typically focus primarily on securities issued by the government called Gilts. These funds are known as the most conservative fixed-income investments. The top 5 Debt- Gilt Mutual Funds in India (as of 31 December 2018) areas listed below:

Fund Name1-Year Return3-Year Return5-Year Return
Reliance Gilt Securities Direct-G9.78%8.57%10.13%
SBI Magnum Gilt Direct-G7.61%7.86%10.02%
ICICI Pru Gilt Direct-G7.62%7.83%9.63%
DSP Government Securities Direct-G9.58%7.55%8.87%
Kotak Gilt Inv Direct-G8.89%6.96%8.95%

Top 5 Hybrid-Dynamic Asset Allocation Funds

Dynamic Asset Allocation Funds follow a basic “buy low, sell high” strategy. For which, they have to be managed actively. The assets, under this, can be dynamically allocated towards equity of debt instruments, as per the prevailing market conditions. These are actively managed open-ended mutual funds. The best performing Hybrid-Dynamic Asset Allocation Funds as of 31 December 2018 have been listed below:

Fund Name1-Year Return3-Year Return5-Year Return
HDFC Balanced Advantage Direct-G6.82%13.84%14.47%
Invesco India Dynamic Equity Direct-G-0.69%11.36%12.17%
Aditya Birla SL Balanced Advantage Direct-G4.08%11.19%11.73%
ICICI Prudential Balanced Advantage Direct-Growth5.27%10.73%12.02%
HSBC Dynamic Asset Allocation Direct-G-0.24%9.7%10.89%

Top 5  Conservative Hybrid Funds

A Conservative Hybrid Fund allocates it an investment, predominantly, in debt instruments. Where 75% to 90% of the funds are invested in debt instruments. On the other hand, the balance of 10% to 25% is invested in equity. The best performing Hybrid-Conservative Hybrid Mutual Funds as of 31 December 2018 have been listed below:

Fund Name1-Year Return3-Year Return5-Year Return
SBI Magnum Children’s Benefit Fund Direct2.05%12.92%14.83%
Kotak Asset Allocator Direct-G7.21%10.07%13.51%
Aditya Birla SL Regular Savings Direct-G1.75%9.59%12.01%
DHFL Pramerica Hybrid Debt Direct-G8.62%9.44%9.11%
Franklin India Life Stage FoF 40s Direct-G4.53%8.68%10.45%

Top 5 Aggressive Hybrid Mutual Funds Investment

Aggressive Hybrid Funds investment assets are allocated between 65% to 80% in equity and the balance 20% to 35% is allocated in debt instruments. The most popular Hybrid-Aggressive Hybrid Funds as of 31 December 2018 have been given below:

Fund Name1-Year Return3-Year Return5-Year Return
Principal Hybrid Equity Fund Direct-Growth-0.18%15.65%14.61%
Mirae Asset Hybrid Equity Direct-G8.77%14.24%
Tata Retirement Savings Moderate Direct-G-1.19%14.17%18.02%
ICICI Pru Equity & Debt-G4.96%13.57%14.98%
Sundaram Equity Hybrid Direct-G4.76%13.19%10.95%


Top 5 Hybrid-Arbitrage Funds

Arbitrage funds are a kind of Hybrid Funds. It is invested in equity shares but generates returns that are in line with short-term debt funds. They are also more efficient in terms of tax saving. If you want to redeem your investment after a year, the gains from overall equities are tax-free up to a certain limit. The best performing Hybrid-Arbitrage Mutual Funds Investment as of 31 December 2018 are listed below:

Fund Name1-Year Return3-Year Return5-Year Return
Reliance Arbitrage Direct-G6.66%6.39%6.85%
Kotak Equity Arbitrage Direct-G6.54%6.32%6.82%
ICICI Pru Equity Arbitrage Direct-G6.41%6.19%6.72%
Axis Arbitrage Direct-G6.22%6.18%
IDFC Arbitrage Direct-G6.54%6.17%6.62%


Please Note: All the above tables are representative only based on key metrics, dated December 31, 2018. It does not serve as a recommendation of funds. Neither does it claim to be the only correct way to rank funds, considering the fluctuations in the market.


However, what you may not know is that selecting a mutual fund is much easier than you think. We, at WealthBucket, the online mutual fund investment portal, are committed to providing you with the best advice and services related to investments. Our services include Equity Mutual fundDebt mutual fund, Large Cap mutual fund, or Multi-Cap mutual fund. Open your mutual fund account with us & make your money grow exponentially.

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Do go through:

SIP Guide

SIP calculator: How does it work

Understanding Balanced Mutual Funds: Benefits, Taxes & Comparison