Many new and relatively inexperienced investors are always looking for the top mutual funds to invest in. They ask their friends and colleagues or on some mutual fund forums for the top or best schemes when they start their investment journey or decide to invest additional funds. However, most of them are not satisfied with the answers they get from the internet or from friends for various reasons.
If you search online, you can almost always reach several websites with ready-made lists. In most cases, schemes may be shortlisted based on short-term performance. In some cases, a single category scheme may top the list because that category happens to be seasonal.
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A friend or colleague may be able to tell you the names of schemes they like or have invested in. Again, there is no guarantee that the system will actually be suitable for you.
Some people never stop collecting the names of top funds because lingering doubts about the authenticity of the names always hinder them. It’s no wonder that many investors continue to visit mutual fund forums for validation years after they start investing.
That’s why ETMutualFunds has decided to publish a list of top 10 mutual fund schemes. We have selected two schemes from five different equity mutual fund categories. Aggressive hybrid, large-cap, mid-cap, small-cap and flexi-cap schemes, which are considered sufficient for regular mutual fund investors. A word of caution: read till the end to make sure you choose the best scheme for you. How to interpret MF’s Trainer ratio
List of top 10 schemes:
Here are some points to keep in mind while investing in these schemes. First, research each category to see if it suits your investment objectives and risk profile.
Aggressive hybrid fund
Aggressive hybrid schemes (or earlier balanced schemes or equity-oriented hybrid schemes) are ideal for beginners in equity mutual funds. These schemes invest in a mix of equity (65-80%) and debt (20-35%). Because of this hybrid portfolio, it is considered relatively less volatile than pure equity schemes. Aggressive hybrid schemes are the best investment vehicle for highly conservative equity investors who want to build long-term wealth without too much volatility.
large cap fund
Some stock investors want to take precautions even when investing in stocks. The large-cap plan is aimed at such people. These schemes invest in top 100 stocks and are relatively safer than other pure equity mutual fund schemes. It also has relatively lower volatility than mid-cap and small-cap schemes. So, if you are looking for relatively stable and modest returns, you should invest in large cap schemes.
flexicap fund
Regular equity investors (those with a moderate risk appetite) looking to invest in the stock market need look no further than flexi cap mutual funds (or diversified equity schemes). These schemes invest across market capitalizations and sectors based on the views of the fund manager. By investing in these schemes, ordinary investors can benefit from the uptrend in stocks of any sector or category.
Small-cap, mid-cap fund
What about aggressive investors who are looking to earn additional profits by taking additional risks? Well, they can bet on mid-cap and small-cap schemes. Mid-cap funds invest primarily in medium-sized companies, while small-cap funds invest in smaller companies in terms of market capitalization. Although these schemes are volatile, they also have the potential to provide good returns over the long term. If you have a long-term investment horizon and prefer higher risk, you can invest in these mutual fund categories.
Finally, searches that begin with the words “best” or “top” are unlikely to provide the best solution. You should always choose a scheme that matches your investment objectives, time horizon and risk profile. If you don’t understand the basic concepts of mutual funds or are completely new to mutual funds and investing, you should always seek the help of a mutual fund advisor.
If you’re looking for recommendations for different mutual fund categories, see Best Mutual Funds to Invest in.
