Low-cost funds are those which generate better returns and have a low expense ratio vis-a-vis their category. Cost in a mutual fund is the total expense ratio which an investor has to bear for investing in various mutual fund schemes. Investors willing to put money in mutual funds should consider these two essential criteria - low expense ratio and high returns.
According to Amfi (Association of Mutual Funds in India) data published in February, there are currently 435 active equity mutual fund schemes across 11 categories. An analysis of Ace Equities' growth funds’ data shows that 213 schemes have completed three years or more while 58 schemes have not yet completed three years. ETMarkets brings five funds with the highest returns in the last three years along with their expense ratios.
The components of the expense ratio include the fund manager's fee, marketing and distribution expenses, legal & audit costs along with other operating costs. An expense ratio also depends upon the type of equity mutual fund scheme i.e. direct or growth plans. The former has a lower expense ratio and may vary from fund to fund and depend upon the activity in a particular fund. A more aggressively-managed fund could have a higher expense ratio.
5 low-cost large & midcap mutual funds with highest 3-year returns.
Here are 5 mutual fund schemes with highest 3-year returns along with their expense ratios:
Quant Small Cap Fund(G) tops the chart with over 39% returns followed by Quant Mid Cap Fund(G), Nippon India Small Cap Fund(G), Quant Flexi Cap Fund(G) and Motilal Oswal Midcap Fund-Reg(G) in the same pecking order.
There are 18 schemes across categories which have delivered more than 25% CAGR in the last three years and have expense ratios lower than 2. Quant Large & Mid Cap Fund(G) (27.55%) has delivered over 25% returns but its expense ratio is slightly above 2. The rest have lower than 25% returns with an expense ratio higher than 2 in many cases.
Taurus Flexi Cap Fund-Reg(G) has the highest expense ratio of 2.64 and its returns in the said period stand at 16.68%.
Also Read: Focused vs thematic funds: Who holds the edge and top 5 funds in each category
Inputs from Surbhi Khanna
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)
FAQs
Here are 5 mutual fund schemes with highest 3-year returns along with their expense ratios: Quant Small Cap Fund(G) tops the chart with over 39% returns followed by Quant Mid Cap Fund(G), Nippon India Small Cap Fund(G), Quant Flexi Cap Fund(G) and Motilal Oswal Midcap Fund-Reg(G) in the same pecking order.
Which mutual fund has the best return in 3 years? ›
Quant Small Cap Fund
The small-cap mutual fund has given a 41.98% return in the last three years. The fund is benchmarked against NIFTY Smallcap 250 Total Return Index, which has given 31.16% return in the same period.
Which sip gives the highest return in 3 years? ›
Best SIP Plans in India in 2024
| Returns |
|---|
| Fund Name | 3 Years | 5 Years |
|---|
| Multi Cap Growth Fund ICICI Prudential | 17.36% | 13.61% |
| Equity Fund SBI | 16.9% | 14.63% |
| Equity II Fund Canara HSBC Oriental Bank | 15.99% | 12.31% |
7 more rowsWhat is the 3-year lock-in period? The 3-year lock-in period applies specifically to Equity Linked Saving Schemes (ELSS) - a type of tax-saving mutual fund. It restricts redeeming your investment within the first 3 years from purchase.
Which 5 mutual fund is best? ›
List of Best Mutual Funds in India sorted by ET Money Ranking
- Quant Small Cap Fund. EQUITY Small Cap. ...
- Quant Mid Cap Fund. ...
- Kotak Infrastructure and Economic Reform Fund. ...
- Quant Multi Asset Fund. ...
- ICICI Prudential Value Discovery Fund. ...
- ICICI Prudential Focused Equity Fund. ...
- DSP Healthcare Fund. ...
- ICICI Prudential Equity & Debt Fund.
The return over three years, expressed in yearly figures. For example a fund that has returned 30% over three years has a 3 year annualised return of 10%.
What is a good return on investment over 3 years? ›
General ROI: A positive ROI is generally considered good, with a normal ROI of 5-7% often seen as a reasonable expectation. However, a strong general ROI is something greater than 10%. Return on Stocks: On average, a ROI of 7% after inflation is often considered good, based on the historical returns of the market.
Which mutual fund doubles in 3 years? ›
Wealth multipliers in last three years
| Scheme Name | Current value of Rs 1 lakh invested three years ago | Multiplied by |
|---|
| Nippon India Small Cap Fund | 2,40,260.12 | 2.40 |
| HSBC Small Cap Fund | 2,31,394.47 | 2.31 |
| Quant Flexi Cap Fund | 2,29,521.35 | 2.30 |
| Franklin India Smaller Cos Fund | 2,25,136.74 | 2.25 |
16 more rowsApr 10, 2024
The top performing mutual funds over the last three years include Nippon India Small Cap Fund, Quant Small Cap Fund, HSBC Small Cap Fund, Tata Small Cap Fund, and ICICI Pru BHARAT 22 FOF.
What if I invest $5,000 in SIP for 5 years? ›
How much is Rs. 5,000 for 5 years in SIP? If you invest Rs. 5,000 per month through SIP for 5 years, assuming 12% return. The estimate total returns will be Rs. 1,12,432 and the estimate future value of your investment will be Rs. 4,12,431.
It completely depends on the mutual fund you invest in. Some mutual funds, do have a lock-in period. ELSS mutual funds have a lock-in period of 3 years. Many other mutual funds have lock-in periods too.
How many years is good for mutual funds? ›
What is the optimal investment duration for short-duration mutual funds? The ideal investment duration in short-duration mutual funds varies based on individual financial objectives and risk tolerance, but generally, a duration of 1-3 years is advisable to balance growth potential with risk management.
Can I withdraw mutual fund after 3 years? ›
Understanding ELSS redemption
ELSS Mutual Funds come with a lock-in period, typically three years. During this lock-in period, investors cannot redeem or withdraw their investments. However, once the lock-in period is over, investors have the flexibility to redeem their ELSS units.
Which is the best mutual fund to invest now for 3 years? ›
Here are 5 mutual fund schemes with highest 3-year returns along with their expense ratios: Quant Small Cap Fund(G) tops the chart with over 39% returns followed by Quant Mid Cap Fund(G), Nippon India Small Cap Fund(G), Quant Flexi Cap Fund(G) and Motilal Oswal Midcap Fund-Reg(G) in the same pecking order. 1.
Which is the rank 1 mutual fund? ›
Top Mutual Fund Houses in India
| S.No. | Mutual Fund House |
|---|
| 1. | SBI Mutual Fund |
| 2. | ICICI Prudential Mutual Fund |
| 3. | HDFC Mutual Fund |
| 4. | Aditya Birla Sun Life Mutual Fund |
6 more rowsMay 16, 2024
Best-performing U.S. equity mutual funds
| Ticker | Name | 5-year return (%) |
|---|
| USSPX | Victory 500 Index Member | 13.60% |
| MAEIX | MoA Equity Index Fund | 13.40% |
| BSPSX | iShares S&P 500 Index Service | 13.33% |
| VLACX | Vanguard Large Cap Index Investor | 13.30% |
3 more rowsMay 1, 2024
Best-performing U.S. equity mutual funds
| Ticker | Name | 5-year return (%) |
|---|
| MAEIX | MoA Equity Index Fund | 13.40% |
| BSPSX | iShares S&P 500 Index Service | 13.33% |
| VLACX | Vanguard Large Cap Index Investor | 13.30% |
| GRMSX | Nationwide S&P 500 Index Svc | 12.92% |
3 more rowsMay 1, 2024
There are eight large cap mutual funds which have delivered over 40 percent return in the past one year. These include Quant Large Cap Fund, Bank of India Bluechip Fund, JM Large Cap Fund and Nippon India Large Cap Fund, among others.
What is the safest investment with the highest return? ›
These seven low-risk but potentially high-return investment options can get the job done:
- Money market funds.
- Dividend stocks.
- Bank certificates of deposit.
- Annuities.
- Bond funds.
- High-yield savings accounts.
- 60/40 mix of stocks and bonds.
