Introduction –
Investing in mutual funds helps build a corpus for various life goals. With them, you can invest in a basket of securities managed by professionals. This makes them an ideal choice to grow your wealth. Explore the Mutual fund Calculator and get deeper insights. Given below are the top 5 mutual funds in India with which you can start your investments.
Top 5 Mutual Funds to Start Your Investment With
1. ICICI Prudential Equity and Debt Fund
The ICICI Prudential Equity and Debt Fund is one of the top 5 mutual funds in India. It offers a balanced mix of equity and debt investments. With 71.86% of its assets in domestic equities, this fund provides exposure to the growth potential of the Indian stock market. In the equity portfolio, 57.03% is in large-cap stocks. These stocks offer stability and reliability.
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Additionally, 7.25% is in mid-cap stocks, offering higher growth opportunities. 1.35% is in small-cap stocks, which have the potential for significant returns. Apart from equities, the fund also holds a large allocation of 20.25% in debt instruments. Within the debt portfolio, 13.55% is in government securities. These are considered safe and provide a stable income stream. Furthermore, 6.12% is invested in low-risk securities. This enhances the fund's risk management capabilities.
2. Kotak Tax Saver Fund
Kotak Tax Saver Fund is next in the list of top 5 mutual funds in India. It is for investors willing to invest their money for at least three years. This fund offers investors the advantage of saving taxes under Section 80C of the IT Act, 1961 in the old tax regime.
It's important to note that investors in this fund should be prepared for the possibility of moderate losses in their investments, as the fund's performance is subject to market fluctuations. Additionally, the Kotak Tax Saver Fund has a lock-in period of three years, which means investors cannot redeem their investments before it.
The fund primarily focuses on investing in domestic equities, with approximately 97.33% allocated to this asset class. Within the equity portfolio, the fund follows a diversified approach, with about 60.62% invested in large-cap stocks, 19.37% in mid-cap stocks, and 10.8% in small-cap stocks. This allocation strategy balances the potential for higher returns while managing risk.
3. Motilal Oswal Long Term Equity Fund
Motilal Oswal Long Term Equity Fund is a well-regarded mutual fund focusing on long-term capital appreciation by investing primarily in domestic equities. With 95.16% of its investments in domestic equities, this fund offers investors significant exposure to the Indian stock market. It follows a well-defined investment philosophy emphasizing investing in high-quality companies with sustainable business models.
Regarding diversification within the equity segment, the fund maintains a balanced approach. It allocates 37.19% of its portfolio to large-cap stocks and 25.81% to mid-cap stocks. It has 7.37% of its portfolio in small-cap stocks.
By investing in a mix of large-cap, mid-cap, and small-cap stocks, the Motilal Oswal Long Term Equity Fund aims to provide diversified exposure to the Indian equity market. This diversification strategy helps reduce the portfolio's overall risk while maximizing returns.
4. Baroda PNB Paribas Aggressive Hybrid Fund
Next on the list of the top 5 mutual funds in India is Baroda PNB Paribas Aggressive Hybrid Fund. It is opted by beginners who seek a balanced mix of equity and debt investments. This fund follows an aggressive hybrid approach, allocating a significant portion of its assets to domestic equities. With 71.68% investment in domestic equities, it offers exposure to various market segments.
Out of the equity allocation, 47.25% is in large-cap stocks, typically known for their stability and potential for long-term growth. Additionally, 9.95% is in mid-cap stocks, which have the potential for higher returns, albeit with slightly higher risk. The fund also has a 3.27% investment in small-cap stocks. These stocks, though volatile, can offer substantial growth opportunities.
5. Mirae Asset Equity Fund
Mirae Asset Equity Fund is popular among investors. It has a robust track record of delivering consistent returns. This fund invests in domestic equities and aims to provide long-term capital appreciation. The latest available data shows that the fund has allocated 73.71% of its investments in domestic equities, with 47.42% of assets in large-cap stocks, 7.71% in mid-caps, and 3.18% in small-cap stocks.
Regarding debt allocation, Mirae Asset Equity Fund has invested 22.81% of its portfolio in debt instruments. Among the debt allocation, 7.43% is in Government securities, which are considered relatively safe investments as the Indian government backs them.
The Final Word
Investing in these top 5 mutual funds in India can help you fulfill your long and short-term financial goals. However, go through the fund factsheet to understand its objective and ensure the fund aligns with your objectives and risk tolerance. To start, open a Demat account with Motilal Oswal to kickstart your investment journey.