Top 10 Equity Mutual Funds for Long-term Investment
Equity mutual funds are a popular investment option for those looking to generate wealth over the long-term. These funds invest in stocks of companies across various sectors and offer higher returns than fixed-income instruments like bonds and deposits. However, picking the right equity mutual fund is crucial to achieving your investment goals. In this blog, we will take a look at the top 10 equity mutual funds that have consistently delivered impressive returns.
- Mirae Asset Large Cap Fund
This fund invests in the stocks of large-cap companies across various sectors. It has consistently outperformed its benchmark, the Nifty 50, over the past 5 years. Its top holdings include HDFC Bank, ICICI Bank, and Reliance Industries.
- Axis Bluechip Fund
This fund primarily invests in blue-chip stocks of companies across various sectors. Its top holdings include HDFC Bank, Reliance Industries, and Infosys. It has consistently delivered higher returns than its benchmark, the Nifty 50.
- Kotak Standard Multicap Fund
This fund invests in stocks of companies across market capitalization and sectors. Its top holdings include HDFC Bank, ICICI Bank, and Reliance Industries. It has consistently outperformed its benchmark, the Nifty 200, over the past 5 years.
- HDFC Mid-Cap Opportunities Fund
This fund invests in the stocks of mid-cap companies across various sectors. Its top holdings include Cholamandalam Investment, City Union Bank, and L&T Finance Holdings. It has consistently delivered higher returns than its benchmark, the Nifty Midcap 100.
- SBI Small Cap Fund
This fund invests in the stocks of small-cap companies across various sectors. Its top holdings include JK Cement, Atul, and Blue Star. It has consistently outperformed its benchmark, the Nifty Smallcap 100, over the past 5 years.
- Axis Midcap Fund
This fund invests in the stocks of mid-cap companies across various sectors. Its top holdings include JK Cement, City Union Bank, and Atul. It has consistently delivered higher returns than its benchmark, the Nifty Midcap 100.
- ICICI Prudential Banking and Financial Services Fund
This fund invests in the stocks of companies in the banking and financial services sector. Its top holdings include HDFC Bank, ICICI Bank, and Kotak Mahindra Bank. It has consistently outperformed its benchmark, the Nifty Financial Services Index, over the past 5 years.
- Franklin India Equity Fund
This fund invests in the stocks of companies across various sectors and market capitalization. Its top holdings include HDFC Bank, ICICI Bank, and Reliance Industries. It has consistently delivered higher returns than its benchmark, the Nifty 500.
- Aditya Birla Sun Life Tax Relief 96 Fund
This fund invests in the stocks of companies across various sectors and market capitalization, with a focus on tax-saving investments. Its top holdings include HDFC Bank, ICICI Bank, and Infosys. It has consistently outperformed its benchmark, the Nifty 500, over the past 5 years.
- Nippon India Small Cap Fund
This fund invests in the stocks of small-cap companies across various sectors. Its top holdings include City Union Bank, Atul, and Navin Fluorine. It has consistently delivered higher returns than its benchmark, the Nifty Smallcap 100.
Before investing in any mutual fund, it is essential to conduct thorough research and analyze the fund’s past performance, fund manager’s track record, expense ratio, and other factors. Additionally, it is crucial to diversify your investment across different asset classes to minimize risk and maximize returns.
Equity mutual funds are considered a high-risk investment option and are ideal for investors with a long-term investment horizon of at least 5-7 years. These funds tend to perform well over the long term but can be volatile in the short term. Therefore, it is essential to invest in equity mutual funds with a long-term perspective.
Apart from the top 10 equity mutual funds mentioned above, there are several other equity mutual funds that have consistently delivered impressive returns over the years. It is essential to consult with a financial advisor and choose the funds that best align with your investment goals and risk appetite.
Conclusion
In conclusion, equity mutual funds are an excellent investment option for long-term wealth creation. However, it is crucial to conduct thorough research and choose the right mutual fund that aligns with your investment goals, risk appetite, and investment horizon. Additionally, it is essential to diversify your investment across different asset classes to minimize risk and maximize returns.
Read more useful content:
- How to invest in mutual funds
- Best Technology Mutual Funds
- All about mutual funds-types & importance
- The Power of SIP Investment in Mutual Funds
Frequently Asked Questions (FAQs)
What is a mutual fund?
A mutual fund is an investment vehicle that pools money from multiple investors and invests in a diversified portfolio of stocks, bonds, or other securities. The profits and losses are shared by the investors in proportion to their investments.
What are equity mutual funds?
Equity mutual funds are mutual funds that invest primarily in stocks or equities. They are high-risk investments that offer potentially higher returns compared to other types of mutual funds.
How do I invest in mutual funds?
You can invest in mutual funds through a financial advisor or an online investment platform. You will need to complete the KYC process and provide the necessary documents such as PAN card, bank account details, and identity proof.
What is the minimum investment amount for mutual funds?
The minimum investment amount for mutual funds varies between fund houses and schemes. It can range from as low as Rs. 100 to Rs. 5,000. However, it is recommended to invest a higher amount for better returns.
What is an expense ratio?
The expense ratio is the fee charged by the mutual fund company to manage the fund. It includes the fund’s operating expenses such as administrative costs, management fees, marketing expenses, and other charges.
How is the NAV of a mutual fund calculated?
The NAV or Net Asset Value of a mutual fund is calculated by dividing the total value of the fund’s assets by the number of outstanding units. The NAV is calculated on a daily basis and reflects the fund’s performance.
What is SIP?
SIP or Systematic Investment Plan is a mode of investing in mutual funds in a systematic and disciplined manner. It allows investors to invest a fixed amount at regular intervals, usually monthly or quarterly, and helps in rupee-cost averaging.
What is the difference between growth and dividend options in mutual funds?
In the growth option, the profits made by the mutual fund are reinvested into the fund, which leads to the growth of the investment. In the dividend option, the profits made by the mutual fund are distributed to the investors as dividends.
What is the lock-in period for mutual funds?
The lock-in period for mutual funds varies between schemes. Some mutual funds have no lock-in period, while others may have a lock-in period of 3-5 years. The lock-in period determines the minimum holding period for the investment.
What are the tax implications of investing in mutual funds?
The tax implications of investing in mutual funds depend on various factors such as the type of mutual fund, holding period, and tax laws. Equity mutual funds held for more than one year are subject to long-term capital gains tax of 10%, while short-term capital gains are taxed at 15%. Debt mutual funds held for more than three years are subject to long-term capital gains tax of 20% after indexation.
