Category: Mutual Funds

Best SIP Mutual Funds in India

For most people, investing does not start with big amounts or perfect timing. It starts with small, regular steps, and that is where SIPs kick in. With a Systematic Investment Plan, you can invest regularly, no matter what the market goes through, and then gradually build up your wealth over time.

There are so many mutual funds to choose from these days that it can be hard to know which SIP is right for you. Large cap, mid cap, small cap, sectoral, flexi cap, each serves a different purpose.

In this blog, we will break down some of the best SIP mutual funds and explain how to choose the right one based on your goals, risk appetite, and investment horizon.

How to Choose the Best SIP Mutual Funds

Choosing the right SIP mutual fund doesn’t have to be complicated. It is not about chasing the highest returns or picking the most commonly discussed fund. Instead, it is about finding a fund that meets your needs, your time frame, and how prepared you are to face ups and downs.

We have mentioned below some points that an investor can consider before starting their SIP.

1. Be Specific About Why You are Investing- Before picking any fund, ask yourself one basic question: What am I investing for?

It could be for long-term wealth, retirement, your child’s education, or even just building a financial cushion. Choosing the right fund is much easier once you know what you want to do.

2. Consider how long you can keep your money invested- Time is one of the biggest advantages in SIP investing. If you’re investing for the long term, temporary market swings won’t matter much. The more time you have to handle volatility, the better it is.

3. Be Truthful About How Comfortable You Are with Risk- Some people are comfortable seeing their investments fluctuate. Others get stressed the moment markets fall. There is no right or wrong here. What matters is choosing a fund that lets you stay invested without panic.

4. Look for Consistency, Not Just Big Returns- Instead of looking at how a fund did last year, look at how it has done over the years. A good SIP fund should do well in all kinds of market conditions. Consistency over time is far more valuable than occasional spikes in returns.

5. Understand How the Fund Is Managed- There is a certain style that each fund follows. Some focus on stable companies, some chase growth, and others look for undervalued opportunities. The stability of a fund manager in decision-making often leads to better long-term results.

6. Keep an Eye on Costs, But Do not Obsess- Expense ratio is important because it affects how much money you make over time. Lower costs are usually better, but they shouldn’t be the only thing you think about. If a fund has consistently done well, it may still be worth it to pay a little more.

7. Check What the Fund Actually Invests In- Take a quick look at the fund’s top holdings and sector exposure. A well-diversified portfolio lowers risk and keeps you from relying too much on one stock or sector.

List of Top 10 SIP Mutual Funds

S. No	Fund Name	Category	Launch Date	Min SIP	AUM (₹ Cr)	NAV (₹)	3 Yr SIP Ret (%)	5 Yr SIP Ret (%)
1	ICICI Prudential Infrastructure Fund	Equity – Infrastructure	31 Aug 2005	₹100	8,160	194.78	17.88	24.36
2	Motilal Oswal Midcap Fund	Equity – Mid Cap	24 Feb 2014	₹500	38,003	100.4	18.85	23.66
3	Bandhan Small Cap Fund	Equity – Small Cap	25 Feb 2020	₹100	18,174	46.23	22.72	23.24
4	HDFC Mid Cap Fund	Equity – Mid Cap	25 Jun 2007	₹100	92,169	202.33	20.68	22.94
5	Franklin Build India Fund	Equity -Thematic (Infra)	4 Sep 2009	₹500	3,068	141.45	17.89	22.35
6	ICICI Prudential Value Fund	Equity – Value Oriented	16 Aug 2004	₹100	60,391	498.08	19.16	20.57
7	Nippon India Growth Mid Cap Fund	Equity – Mid Cap	8 Oct 1995	₹100	40,042	700.71	19.41	21.48
8	HDFC Focused Fund	Equity – Flexi Cap	17 Sep 2004	₹100	26,230	238.45	18.98	21.26
9	Motilal Oswal Large & Mid Cap Fund	Equity – Flexi Cap	17 Oct 2019	₹100	15,146	33.34	19.95	21.13
10	HDFC Flexi Cap Fund	Equity – Flexi Cap	1 Jan 1995	₹100	94,069	2,073.28	19.49	21.06

(Data as of 02th Janurary, 2026)

1. ICICI Prudential Infrastructure Fund

ICICI Prudential Mutual Fund is a well-known name in India’s mutual fund industry. It began in 1993 and is backed by ICICI Bank and Prudential Plc, a UK-based company. The fund house has built a strong reputation for investing driven by research. It has a diverse range of funds across various categories. Exit Load is 1% for redemption within 15 days. Return since launch is 15.75%. The Fund Manager is Ihab Dalwani.

2. Motilal Oswal Midcap Fund

Motilal Oswal Financial Services started Motilal Oswal Mutual Fund in 2008 and is based in Mumbai. It manages an array of different mutual fund schemes and tries to add value through extensive research and active fund management. Exit Load is 1% for redemption within 365 days. Return since launch is 21.58%. The Fund Manager is Niket Shah.

3. Bandhan Small Cap Fund

Bandhan Mutual Fund is one of India’s oldest fund houses and has been managing funds since 2000. Bandhan Financial Holdings bought it and changed its name from IDFC Mutual Fund to Bandhan Financial Holdings. Today, it offers a wide range of equity, debt, and hybrid funds. Exit Load is 1% for redemption within 365 days. Return since launch is 30.21%. Fund Managers of the fund are Kirthi Jain & Manish Gunwani.

4. HDFC Mid Cap Fund

Founded in 1999, HDFC Mutual Fund is one of the oldest and most well-known AMCs in India. It is part of the prominent HDFC Group. It offers different mutual fund schemes in multiple categories. Exit Load is 1% for redemption within 365 days. Return since launch is 17.67%. The fund manager is Chirag Setalvad.

5. Franklin Build India Fund

As a part of the international investment company Franklin Templeton, Franklin Templeton Mutual Fund has been operating in India for many years. It has long offered a variety of debt, equity, and hybrid funds and is renowned for its long-term, research-driven investment philosophy. Exit Load is 1% for redemption within 365 days. Return since launch is 17.67%. The Fund Manager is Ajay Argal.

6. ICICI Prudential Value Fund

This fund follows a value investing philosophy, focusing on stocks that are undervalued when compared to their intrinsic value. Exit Load is 1% for redemption within 365 days. Return since launch is 20.10%. The Fund Manager is Dharmesh Kakkad.

7. Nippon India Growth Mid Cap Fund

Nippon India Mutual Fund was founded in 1995 and is among India’s largest and fastest-growing AMCs. It manages a variety of equity, debt, hybrid, and index funds and is backed by Nippon Life Insurance of Japan. Exit Load is 1% for redemption within 30 days. Return since launch is 22.15%

8. HDFC Focused Fund

A fund that follows a focused investing approach and concentrates its portfolio on a select number of companies. Exit Load is 1% for redemption within 365 days. Return since launch is 16.10%. The Fund Manager is Gopal Agarwal. The fund is generally chosen by investors who believe in quality over quantity.

9. Motilal Oswal Large & Mid Cap Fund

This fund is offered by Motilal Oswal Mutual Fund, a Mumbai-based AMC known for its strong research capabilities. The fund invests in both large-cap and mid-cap stocks, blending stability with growth potential. Exit Load is 1% for redemption within 365 days. Return since launch is 21.60%. The Fund Manager is Ajay Khandelwal.

10. HDFC Flexi Cap Fund

The fund has been in existence for over 30 years. The approach is to balance risk and reward.

Exit Load is 1% for redemption within 365 days. Return since launch is 18.80%. The fund manager is Chirag Setalvad.

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Conclusion

There isn’t a “best” SIP mutual fund that works for everyone. The right fund is one that fits your financial goals, your risk tolerance, and lets you stay invested calmly through market ups and downs. SIP investing is less about guessing what will happen in the markets and more about being disciplined and patient if you pick the right mix of funds and give your investments enough time.

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Frequently Asked Questions (FAQs)

What is SIP in Mutual Funds?
An SIP lets you invest a fixed amount regularly in a mutual fund instead of investing a lump sum at once.
Are SIPs safe investments?
SIPs are market-linked, so returns are not guaranteed, but they help reduce risk through disciplined investing over time.
Can I stop or pause my SIP anytime?
Yes, SIPs are flexible and can be paused, modified, or stopped anytime.
Do SIPs give guaranteed returns?
No, SIP returns depend on market performance, but long-term investing improves return potential.
How many SIPs should I have at one time?
It is better to have a few well-chosen SIPs aligned with your goals rather than too many overlapping funds.

January 12, 2026

Best Gilt Mutual Funds in India: Returns, Risks & Top Picks

In 2026, India’s bond and interest rate environment has become crucial for investors. Fluctuations in interest rates are being observed due to efforts to control inflation and the policies of the Reserve Bank of India (RBI). In such a scenario, many investors are turning to government-backed mutual funds, where credit risk is virtually non-existent. Gilt mutual funds are considered useful for investors who seek stable returns with a safe option and want to maintain a balanced portfolio. This article will help you understand gilt fund returns, the risks associated with them, and suitable gilt funds for 2026.

What Are Gilt Mutual Funds?

Gilt mutual funds are included in the debt mutual fund categories defined by SEBI (Securities and Exchange Board of India). The primary objective of these funds is to invest investors’ money in government bonds to minimize credit risk.

Best Gilt Mutual Funds to invest in India

SBI Gilt Fund
ICICI Prudential Gilt Fund
HDFC Gilt Fund
Nippon India Gilt Fund
Baroda BNP Paribas Gilt Fund
Tata Gilt Securities Fund
Axis Gilt Fund
UTI Gilt Fund
Quant Gilt Fund
PGIM India Gilt Fund

Best Gilt Mutual Funds – An Overview

1. SBI Gilt Fund

The SBI Gilt Fund is managed by SBI Mutual Fund, which was established on February 7, 1992. This fund invests exclusively in government bonds and exhibits stability due to its large size. The portfolio has a significant allocation to government securities maturing between 2032 and 2055, such as bonds maturing in 2040 and 2035, giving it long-duration exposure. The fund is managed by Sudhir Agarwal.

Fund Details :

Details	Information
Current NAV	70.07
Fund Size	11,033.35
Expense Ratio	0.95%
Minimum Investment	₹5,000
Minimum SIP	₹500
Exit Load	Nil
Lock-in Period	Not Applicable
Fund Manager	Sudhir Agarwal

Fund Performance

Metric	Value
3-year return	7.33
5-year return	6.09
Alpha	-0.07%
Beta	1.05
Sharpe Ratio	0.05
Risk	6.83%

2. ICICI Prudential Gilt Fund

ICICI Prudential Gilt Fund is a pure government bond-based mutual fund managed by ICICI Prudential AMC, which was launched in 1993. This fund invests its money exclusively in bonds issued by the central and state governments, thus eliminating the risk of credit default. Its portfolio includes long-term G-Secs maturing between 2055 and 2065, along with some State Development Loans, which allows the fund to perform well during periods of falling interest rates.

Fund Details :

Details	Information
Current NAV	112.83
Fund Size	92,15.50
Expense Ratio	1.10%
Minimum Investment	₹5,000
Minimum SIP	₹1,000
Exit Load	Nil
Lock-in Period	Not Applicable
Fund Manager	Manish Banthia

Fund Performance

Metric	Value
3-year return	8.21
5-year return	6.69
Category Average (3Y)	6.34%
Alpha	0.02%
Beta	0.62
Sharpe Ratio	0.16
Risk	7.65%

3. HDFC Gilt Fund

The HDFC Gilt Fund is managed by HDFC Mutual Fund and was launched on December 10, 1999. This fund invests exclusively in bonds issued by the central government and has been active in the gilt segment for a long time. Its portfolio includes government bonds maturing between 2031 and 2065, making it suitable for medium- to long-term investors. Fund manager Anil Bamboli manages the duration of the portfolio keeping the prevailing interest rate environment in mind.

Fund Details :

Details	Information
Current NAV	58.57
Fund Size	2,938.91
Expense Ratio	0.89%
Minimum Investment	₹100
Minimum SIP	₹100
Exit Load	Nil
Lock-in Period	Not Applicable
Fund Manager	Anil Bamboli

Fund Performance

Metric	Value
3-year return	7.22
5-year return	5.35
Alpha	-0.07%
Beta	0.91
Sharpe Ratio	0.04
Risk	6.77%

4 . Nippon India Gilt Fund

The Nippon India Gilt Fund is managed by Nippon India Mutual Fund, which was established on February 24, 1995. This fund invests exclusively in bonds issued by the central and state governments. The portfolio has a significant allocation to long-term G-Secs maturing between 2039 and 2064, along with some State Development Loans (SDLs) and net current assets to maintain liquidity. The fund is managed by Pranay Sinha, who focuses on balancing duration and risk.

Fund Details :

Details	Information
Current NAV	42.92
Fund Size	1,862.21
Expense Ratio	1.28%
Minimum Investment	₹5,000
Minimum SIP	₹100
Exit Load	0.25% up to 7 days; Nil thereafter
Lock-in Period	Not Applicable
Fund Manager	Pranay Sinha

Fund Performance

Metric	Value
3-year return	7.04
5-year return	5.44
Alpha	-0.13%
Beta	1.09
Sharpe Ratio	-0.01
Risk	6.20%

5. Baroda BNP Paribas Gilt Fund

The Baroda BNP Paribas Gilt Fund is managed by Baroda BNP Paribas Mutual Fund and was launched on November 4, 2003. This fund invests exclusively in government bonds and its portfolio has a significant allocation to G-Secs maturing between 2035 and 2065. The fund focuses on stable duration management to mitigate the impact of interest rate fluctuations. It is managed by Gurvinder Singh Vasan.

Fund Details :

Details	Information
Current NAV	46.96
Fund Size	1,326.61
Expense Ratio	0.45%
Minimum Investment	₹5,000
Minimum SIP	₹500
Exit Load	Nil
Lock-in Period	Not Applicable
Fund Manager	Gurvinder Singh Wasan

Fund Performance

Metric	Value
3-year return	7.58
5-year return	5.55
Alpha	-0.04%
Beta	1.02
Sharpe Ratio	0.10
Risk	7.23%

6. Tata Gilt Securities Fund

The Tata Gilt Securities Fund is managed by Tata Mutual Fund and was launched on March 15, 1994. This fund focuses entirely on government bonds and invests in bonds issued by the central government as well as some state governments. The portfolio includes long-term G-Secs maturing between 2033 and 2074, making the fund sensitive to changes in interest rates. Additionally, liquidity is maintained through holdings in Repo Instruments. The fund is managed by Akhil Mittal.

Fund Details :

Details	Information
Current NAV	87.57
Fund Size	1,288.11
Expense Ratio	1.37%
Minimum Investment	₹5,000
Minimum SIP	₹150
Exit Load	Nil
Lock-in Period	Not Applicable
Fund Manager	Akhil Mittal

Fund Performance

Metric	Value
3-year return	7.62
5-year return	5.59
Alpha	-0.12%
Beta	1.12
Sharpe Ratio	0.01
Risk	6.53%

7. Axis Gilt Fund

The Axis Gilt Fund is managed by Axis Mutual Fund and was launched on January 13, 2009. This fund invests exclusively in central government bonds, thus eliminating credit risk. Its portfolio has a significant allocation to long-term government bonds maturing between 2034 and 2065, making the fund sensitive to interest rate fluctuations. The fund is managed by Devang Shah, who focuses on maintaining a balanced duration in the portfolio.

Fund Details :

Details	Information
Current NAV	27.38
Fund Size	599.23
Expense Ratio	0.82%
Minimum Investment	₹5,000
Minimum SIP	₹1,000
Exit Load	Nil
Lock-in Period	Not Applicable
Fund Manager	Devang Shah

Fund Performance

Metric	Value
3-year return	7.62
5-year return	5.82
Alpha	-0.08%
Beta	0.96
Sharpe Ratio	0.07
Risk	7.17%

7. UTI Gilt Fund

The UTI Gilt Fund is managed by UTI Mutual Fund and was established on November 14, 2002. This fund is entirely focused on government bonds and holds a significant portion of G-Secs (Government Securities) maturing between 2031 and 2053 in its portfolio. A portion of the fund is also invested in State Development Loans and net current assets to maintain liquidity. The fund is managed by Pankaj Pathak, who focuses on stable duration and risk control.

Fund Details :

Details	Information
Current NAV	65.58
Fund Size	560.78
Expense Ratio	0.93%
Minimum Investment	₹500
Minimum SIP	₹500
Exit Load	Nil
Lock-in Period	Not Applicable
Fund Manager	Pankaj Pathak

Fund Performance

Metric	Value
3-year return	7.06
5-year return	5.44
Alpha	-0.07%
Beta	0.96
Sharpe Ratio	0.05
Risk	6.78%

8. Quant Gilt Fund

The Quant Gilt Fund is managed by Quant Mutual Fund, which was established on December 1, 1995. This fund invests exclusively in government bonds and some State Development Loans (SDLs). Its portfolio is spread across government bonds maturing between 2030 and 2064, while also maintaining liquidity and diversification through TREPS and SDLs. The fund is managed by Sanjeev Sharma, who actively manages the duration based on the changing interest rate environment.

Fund Details :

Details	Information
Current NAV	12.17
Fund Size	111.73
Expense Ratio	1.41%
Minimum Investment	₹5,000
Minimum SIP	₹1,000
Exit Load	Nil
Lock-in Period	Not Applicable
Fund Manager	Sanjeev Sharma

Fund Performance

Metric	Value
3-year return	6.73
5-year return	–
Alpha	-0.15%
Beta	1.06
Sharpe Ratio	-0.09
Risk	5.76%

10. PGIM India Gilt Fund

The PGIM India Gilt Fund is managed by PGIM India Mutual Fund, which was established on September 24, 2008. This fund invests exclusively in government bonds, and its portfolio has a significant allocation to G-Secs maturing between 2034 and 2055. Liquidity is maintained by holding a portion of the assets in net current assets. The fund is managed by Puneet Pal, whose focus is on duration control and risk management.

Fund Details :

Details	Information
Current NAV	32.64
Fund Size	105.01
Expense Ratio	1.38%
Minimum Investment	₹5,000
Minimum SIP	₹1,000
Exit Load	Nil
Lock-in Period	Not Applicable
Fund Manager	Gurvinder Singh Wasan

Fund Details :

Metric	Value
3-year return	7.28
5-year return	5.79
Alpha	-0.12%
Beta	1.01
Sharpe Ratio	-0.01
Risk	6.23%

Risks Associated With Gilt Mutual Funds

Impact of Interest Rate Changes : Gilt funds are directly linked to government bonds, so changes in interest rates affect their Net Asset Value (NAV). When interest rates rise, the value of existing bonds decreases, and the fund’s value may fall.
Short-Term Return Risk : If you invest in gilt funds for a very short period, the returns can be uncertain, especially if the direction of interest rates changes suddenly.
Market Liquidity Conditions : Government bonds are generally easy to buy and sell, but liquidity can decrease somewhat during periods of market stress.
Inflation-Related Risk : If the returns from a gilt fund are lower than the inflation rate, the investor’s real earnings are affected. This is why they are not considered entirely risk-free.

Conclusion

Gilt mutual funds can be suitable for investors seeking relatively safe investments through government bonds and who understand the fluctuations in interest rates. Choosing the right gilt fund requires considering the investment horizon, risk tolerance, and the prevailing interest rate environment. In the long run, these funds can help stabilize a portfolio, but investing without understanding the risks is not advisable.

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Frequently Asked Questions (FAQs)

What is a gilt mutual fund?
This is a mutual fund that invests exclusively in government-issued bonds.
Are gilt funds completely safe?
There is no credit risk, but returns can fluctuate due to changes in interest rates.
Can I lose money in gilt funds?
Yes, in the short term, especially when interest rates rise.
Who should consider investing in gilt funds?
Investors who want to invest for 3-5 years or longer.
Are gilt funds better than fixed deposits?
Fixed deposits offer a fixed return, while returns from gilt funds depend on market conditions.

January 10, 2026

How Interest Rates Impact Mutual Funds in India

A few years ago, fixed deposits felt like the safest answer for most investors. Investors used to lock their funds in a fixed deposit and earn a steady interest. There was limited concern about market fluctuations, as fixed deposits offered predictable returns. But then interest rates started moving and returns changed. Suddenly, many people began looking beyond deposits and towards mutual funds.

This shift highlights why interest rates and mutual funds are deeply connected. In fact, a change in the interest rate can impact the mutual fund performance, especially over time. To invest with clarity, it is also important to understandhow interest rates influence mutual funds, rather than treating them as the same thing.

So, if you are new to investing or have been investing for years now, read this guide. Understand how these two are connected and why you should evaluate the relationship when you plan to invest.

Understanding Interest Rates

Interest rates affect everyday money decisions, even when we do not notice them directly. From loan EMIs to returns on deposits, almost every financial decision is influenced by interest rates. Simply put, interest rates are the cost of borrowing money and the reward for saving it.

Here is how interest rates work in real life:

When the interest rate is low, borrowing rates are low. People can borrow more at a lower cost. This increases the spending capacity of the people.
When the interest rate is high, the earning part of savings becomes more lucrative. This is the time when people spend less and invest more into savings.

These changes influence markets and investment products, including mutual funds. Understanding this basic cycle helps you see why interest rates matter beyond banks and deposits.

RBI Tools That Shape Interest Rates

Interest rates in India do not move on their own, they are largely influenced by policy decisions and economic conditions.. Behind every interest rate rise or cut, there is a decision taken by the Reserve Bank of India. The RBI’s role is not to chase market returns. It works to ensure that the economy is stable and is helping the banking system work seamlessly.

The RBI rates that you must know of are as follows:

1. Repo Rate

The repo rate is the interest rate at which banks borrow money from the RBI. This is usually for short periods. When the repo rate goes up, banks pay more to borrow. This usually leads to higher loan interest for customers. When the repo rate comes down, loans become cheaper. This is the time when spending quickly picks up.

2. Reverse Repo Rate

The reverse repo rate is the opposite. It is the rate banks earn when they park extra money with the RBI. When this rate is high, banks prefer keeping money with the RBI instead of lending. This reduces money flow in the economy and the general interest rate rises. When it is low, banks are in a position where they can lend more and interest rates fall.

3. Cash Reserve Ratio (CRR)

This is the amount that the banks keep with the RBI for safekeeping. It is the amount that the bank cannot use for lending to customers. A rise in CRR means that banks have less money to lend, and so rates will rise. At the same time, when CRR falls, the money with banks increases to give out loans to customers. Now banks can lend more at lower rates.

With the help of these, the RBI controls the money supply and the credit growth. Also, the overall interest rate direction is determined without directly setting loan rates.

Factors Affecting Interest Rates

Interest never moves in a straight line. It works in cycles. This is why it is very important to know all the factors that impact the interest rates and how you can actually manage them better. So, the key factors are as follows:

1. Inflation Pressure

When everyday costs like food, fuel, and services rise quickly, interest rates are increased. Higher rates make borrowing costly. This reduces the amount that people seek as a loan. This also reduces the purchasing parity as well and so the consumption as well.

2. Pace of Economic Activity

If businesses are expanding and people are spending freely, demand for loans increases. This pushes interest rates upward. When economic activity slows, lower rates are used to encourage borrowing and revive demand.

3. Availability of Money With Banks

When banks have excess funds, lending becomes easier and interest rates remain low. If funds dry up, banks raise rates to manage risk. Central bank actions often control this flow of money using various monetary tools.

4. Government Spending and Borrowing

Large government borrowing increases demand for funds in the market. This can lead to higher interest rates. Lower borrowing eases pressure and supports stable rates.

5. Global Market Influence

Interest rate moves in other major economies affect capital movement. If global rates rise, domestic rates may also increase to retain foreign investment. When global rates fall, there is room to cut rates locally.

All these factors work together and create a positive or negative impact on the interest rates. This thereby creates pressure on the investment plans as well.

How Interest Rates Impact Mutual Funds

Interest rate changes gradually make their way into mutual fund performance over time. The effect is not instant, but it becomes clear over time. The impact also depends on the type of mutual fund you hold. Debt funds react faster, equity funds react gradually, and hybrid funds fall somewhere in between.

1. Impact on Debt Mutual Funds

Debt mutual funds are the ones that are impacted by the interest rates directly. This is mainly because these funds invest in bonds and other debt instruments.

When interest rates rise, new bonds offer higher yields. Existing bonds with lower rates lose value, which can pull down debt fund NAVs. When interest rates fall, older bonds with higher coupons become more attractive and the bond value rises. So debt fund NAVs usually rise.

Long-duration debt funds are more sensitive to rate changes. Short-term and liquid funds are less affected.

2. Impact on Equity Mutual Funds

Equity mutual funds are affected indirectly as it has an impact on the company’s financials, profits and its investment decision. This impacts the market liquidity as well.

Lower interest rates reduce borrowing costs for companies. This supports expansion and improves earnings. This is positive for equity funds. Higher interest rates increase borrowing costs and slow economic growth. This can pressure stock valuations and its profitability.

The impact is not uniform. Rate-sensitive sectors feel it more, while defensive sectors remain relatively stable.

3. Impact on Hybrid Mutual Funds

Hybrid mutual funds hold both equity and debt. Their reaction to interest rate changes is more balanced.

The debt portion reacts directly to rate movements. The equity portion reacts based on growth expectations. Because these funds combine equity and debt, the overall impact is more balanced. This is why the same shows a relatively smoother and gradual performance across the interest rate cycles.

This makes them suitable for investors who want stability during changing rate environments.

In conclusion, interest rates influence mutual fund performance in different ways across fund categories. But in reality, they affect return direction and volatility, which are key factors in mutual fund performance analysis. So, there is an indirect relationship between interest rates and mutual funds.

Understanding the Link Between Interest Rates and Mutual Funds

Interest rates influence mutual funds in different ways, depending on what the fund invests in. A simple comparison helps make this link clearer. Instead of tracking every rate change, it is better to understand the pattern and how each fund type usually reacts.

The table below explains this connection in a practical way.

Interest Rate Movement	Debt Mutual Funds	Equity Mutual Funds	Hybrid Mutual Funds
Rates increase	Bond prices fall. Debt fund NAVs may decline, especially in long-duration funds.	Borrowing costs rise. Profit expectations may reduce, affecting market sentiment.	The debt portion may face pressure. The equity portion may turn cautious.
Rates decrease	Bond prices rise. Debt fund NAVs generally improve.	Lower borrowing costs support growth and valuations over time.	Debt gains support. Equity benefits gradually from growth optimism.
Stable rates	Returns come mainly from interest income. Volatility stays low.	Markets focus on earnings and fundamentals.	Balanced performance with limited volatility.
Sharp rate changes	High impact on long-duration funds. Short-term funds stay safer.	Short-term volatility increases before markets adjust.	Asset allocation helps smooth the impact.

Tips to Protect Your Mutual Fund Investments During Interest Rate Changes

Interest rate cycles are unavoidable. But understanding how to invest during these cycles can help you manage risk more effectively. So, you need to work on logic and not emotions and it requires a disciplined approach. Some of the tips for you to follow are as follows:

1. Match Fund Type With Rate Direction

When interest rates are rising, prefer short-duration or low-duration debt funds. They face less price pressure. When rates are expected to fall, longer-duration debt funds may benefit more.

2. Avoid Frequent Switching

Constantly moving between funds based on rate news often hurts returns. Interest rate impact plays out over time. Staying disciplined works better than trying to time every move.

3. Keep Equity Investments Goal Focused

Equity mutual funds should be aligned with long-term goals. Short-term changes can lead to volatility, but you should not panic. It is generally better to stay invested over the long-term to absorb short-term rate-driven volatility.

4. Use Asset Allocation to Reduce Risk

You must spread your investment across different assets. This will work best when there are market fluctuations and reduce overall portfolio risk. When one asset reacts negatively to rates, another may offer stability.

5. Review, Do Not Panic

Rate changes are normal. Review your portfolio periodically based on goal and time horizon. These small corrections lead to better results and can improve outcomes over time without unnecessary disruption.

These steps help you stay invested with confidence, even when interest rates move against expectations.

Conclusion

Interest rates are never the same. They change with time and can create varied impacts on investments. This is why it becomes really important for investors to keep an eye on the investment options as well as the interest rate.

Mutual funds react to these changes in different ways. And once you know and understand this, you will be working for investments based on logic. This will remove all the noise from between.

If you want to track interest rate trends and choose mutual funds that match your goals, platforms like Pocketful can help you invest with clarity and confidence.

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4	What is an Open-Ended Mutual Fund & How to Invest in it?
5	Mutual Fund vs ETF. Are They Same Or Different?
6	Mutual Funds vs Direct Investing: Differences, Pros, Cons, and Suitability
7	Debt Mutual Funds: Meaning, Types and Features
8	How to Check Mutual Fund Status with Folio Number?
9	Mutual Funds vs Direct Investing: Differences, Pros, Cons, and Suitability
10	What is Solution Oriented Mutual Funds?

Frequently Asked Questions (FAQs)

o mutual fund returns change immediately when interest rates change?
Debt mutual funds may react quickly, especially long-duration funds. Equity mutual funds usually respond gradually as company earnings and market sentiment adjust.
Are debt mutual funds safe when interest rates are rising?
Short-duration and liquid debt funds are relatively safer during rising interest rate phases. Long-duration funds carry higher interest rate risk.
Should I stop SIPs in equity funds when interest rates rise?
No. Rising interest rates can cause short-term volatility, but long-term equity investing works best when SIPs are continued without interruption.
Which mutual funds benefit most when interest rates fall?
Long-duration debt funds and dynamic bond funds usually benefit more when interest rates decline, as bond prices tend to rise.
Can interest rates alone decide mutual fund performance?
No. Interest rates influence returns. But if you consider the overall performance, there are other factors as well that can create a varied impact. Analysing all will help you invest better.

January 8, 2026

Best Target Maturity Mutual Funds in India to Invest

In India today, many investors are looking for investment options that offer both security of capital and a predictable return. This has led to increased interest in Target Maturity Mutual Funds. These debt funds invest in government and highly-rated bonds for a fixed period. In the current volatile interest rate environment, they are being seen as a balanced alternative to Fixed Deposits (FDs) and traditional Fixed Maturity Plans (FMPs) during 2025.

What Are Target Maturity Mutual Funds?

Target Maturity Mutual Funds are passive debt funds that have a fixed maturity date. These funds track a specific bond index and maintain their investments in the bonds included in that index until their maturity. The objective is to provide investors with relatively stable and predictable returns over time, provided the investment is held until maturity.

Best Target Maturity Mutual Funds to invest in India

HDFC Nifty G Sec July 2031 Index Direct Growth
Aditya Birla Sun Life CRISIL IBX Gilt Apr 2029 Index Fund Direct Growth
Nippon India Nifty G Sec Jun 2036 Maturity Index Fund Direct Growth
SBI CRISIL IBX Gilt Index April 2029 Fund Direct Growth
SBI CRISIL IBX Gilt Index June 2036 Fund Direct Growth
HDFC Nifty G Sec Sep 2032 Index Direct Growth
ICICI Prudential Nifty SDL Dec 2028 Index Fund Direct Growth
Mirae Asset CRISIL IBX Gilt Index April 2033 Index Fund Direct Growth
ICICI Prudential Nifty G Sec Dec 2030 Index Fund Direct Growth
Edelweiss CRISIL IBX 50:50 Gilt Plus SDL Sep 2028 Index Fund Direct Growth

Read Also: Best Investment Options in India

1. HDFC Nifty G Sec July 2031 Index Direct Growth

HDFC Nifty G Sec July 2031 Index Direct Growth is a target maturity debt fund that tracks the Nifty G-Sec July 2031 Index. Investments in this scheme are primarily made in government bonds issued by the Government of India, which limits credit risk. The fund has a fixed maturity date, and its performance depends on interest rate fluctuations and index movements.

Fund Details:

Details	Information
Current NAV	12.87
Fund Size	670.47
Expense Ratio	0.20
Minimum Investment	100
Minimum SIP	100
Exit Load	Nill
Fund Manager	Sankalp Baid
1-year return	7.82
3-year return	8.43

2. Aditya Birla Sun Life CRISIL IBX Gilt Apr 2029 Index Fund Direct Growth

The Aditya Birla Sun Life CRISIL IBX Gilt Apr 2029 Index Fund Direct Growth is a debt fund with a fixed maturity date of April 2029. This fund invests in government bonds that are part of the CRISIL IBX Gilt Index. Since the investments are in government-issued bonds, the credit risk is low. The fund’s Net Asset Value (NAV) fluctuates periodically with changes in bond yields and interest rates, especially before maturity.

Fund Details:

Details	Information
Current NAV	13.03
Fund Size	610.41
Expense Ratio	0.22
Minimum Investment	500
Minimum SIP	500
Exit Load	Nill
Fund Manager	Harshil Suvarnkar
1-year return	8.78
3-year return	8.46

3 . Nippon India Nifty G Sec Jun 2036 Maturity Index Fund Direct Growth

The Nippon India Nifty G Sec Jun 2036 Maturity Index Fund Direct Growth is a target maturity debt fund with a maturity date of June 2036. This fund invests in government bonds included in the Nifty G-Sec June 2036 Index. Since the entire investment is in government securities, its structure is considered to have limited credit risk. The fund’s Net Asset Value (NAV) fluctuates periodically based on changes in interest rates and bond yields, especially before maturity.

Fund Details:

Details	Information
Current NAV	12.75
Fund Size	845.56
Expense Ratio	0.20
Minimum Investment	1000
Minimum SIP	100
Exit Load	Nill
Fund Manager	Siddharth Deb
1-year return	6.65
3-year return	8.46

4. SBI CRISIL IBX Gilt Index April 2029 Fund Direct Growth

The SBI CRISIL IBX Gilt Index April 2029 Fund Direct Growth is a target maturity debt fund with a maturity date of April 2029. This fund invests in government bonds included in the CRISIL IBX Gilt Index. Since the fund invests in securities issued by the central government, its credit structure is relatively secure. The fund’s Net Asset Value (NAV) fluctuates over time based on changes in bond yields and interest rates, particularly as it approaches maturity.

Fund Details:

Details	Information
Current NAV	12.98
Fund Size	2088.17
Expense Ratio	0.21
Minimum Investment	5000
Minimum SIP	500
Exit Load	Nill
Fund Manager	Ranjana Gupta
1-year return	8.76
3-year return	8.38

5. SBI CRISIL IBX Gilt Index June 2036 Fund Direct Growth

The SBI CRISIL IBX Gilt Index June 2036 Fund Direct Growth is a target maturity debt fund with a maturity date of June 2036. This fund invests in long-term government bonds included in the CRISIL IBX Gilt Index. Since the entire investment is in government securities, the credit risk is limited. The fund’s Net Asset Value (NAV) fluctuates with changes in interest rates and bond yields, particularly in the years leading up to maturity.

Fund Details:

Details	Information
Current NAV	13.01
Fund Size	2741.92
Expense Ratio	0.28
Minimum Investment	5000
Minimum SIP	500
Exit Load	Nill
Fund Manager	Ranjana Gupta
1-year return	6.45
3-year return	8.36

6. HDFC Nifty G Sec Sep 2032 Index Direct Growth

HDFC Nifty G Sec Sep 2032 Index Direct Growth is a target maturity debt fund with a maturity date of September 2032. This fund invests in government bonds included in the Nifty G-Sec September 2032 Index. Due to its entire investment being in government securities, it has a clean credit structure. The fund’s Net Asset Value (NAV) fluctuates over time based on changes in interest rates and bond yields, particularly in the period leading up to maturity.

Fund Details:

Details	Information
Current NAV	12.74
Fund Size	650.26
Expense Ratio	0.20
Minimum Investment	100
Minimum SIP	100
Exit Load	Nill
Fund Manager	Sanklap Baid
1-year return	7.51
3-year return	8.34

7. ICICI Prudential Nifty SDL Dec 2028 Index Fund Direct Growth

ICICI Prudential Nifty SDL Dec 2028 Index Fund Direct Growth is a target maturity debt fund with a maturity date of December 2028. This fund invests in bonds issued by state governments (SDLs) included in the Nifty SDL Index. Since the underlying investments are in state government securities, the credit structure is relatively clean. The fund’s Net Asset Value (NAV) fluctuates over time with changes in interest rates and bond yields, particularly before maturity.

Fund Details:

Details	Information
Current NAV	12.97
Fund Size	860.65
Expense Ratio	0.20
Minimum Investment	1000
Minimum SIP	–
Exit Load	Nill
Fund Manager	Darshil Dedhia
1-year return	8.12
3-year return	8.23

8. Mirae Asset CRISIL IBX Gilt Index April 2033 Index Fund Direct Growth

The Mirae Asset CRISIL IBX Gilt Index April 2033 Index Fund Direct Growth is a target maturity debt fund with a maturity date of April 2033. This fund invests in central government bonds that are part of the CRISIL IBX Gilt Index. Since the entire portfolio is based on government securities, credit risk is limited. The fund’s NAV fluctuates according to bond yields and interest rate movements, particularly in the period leading up to maturity.

Fund Details:

Details	Information
Current NAV	13.01
Fund Size	228.78
Expense Ratio	0.12
Minimum Investment	5000
Minimum SIP	–
Exit Load	Nill
Fund Manager	Mahendra Kumar Jajoo
1-year return	7.44
3-year return	8.29

9. ICICI Prudential Nifty G Sec Dec 2030 Index Fund Direct Growth

ICICI Prudential Nifty G Sec Dec 2030 Index Fund Direct Growth is a target maturity debt fund with a maturity date of December 2030. This fund invests in government bonds included in the Nifty G-Sec December 2030 Index. Due to its investment structure being entirely based on government securities, the credit risk is limited. The fund’s Net Asset Value (NAV) fluctuates periodically with changes in interest rates and bond yields, particularly in the period leading up to maturity.

Fund Details:

Details	Information
Current NAV	12.93
Fund Size	883.74
Expense Ratio	0.20
Minimum Investment	1000
Minimum SIP	500
Exit Load	Nill
Fund Manager	Darshil Dedhia
1-year return	7.68
3-year return	8.21

10. Edelweiss CRISIL IBX 50:50 Gilt Plus SDL Sep 2028 Index Fund Direct Growth

The Edelweiss CRISIL IBX 50:50 Gilt Plus SDL Sep 2028 Index Fund Direct Growth is a target maturity debt fund with a maturity date of September 2028. This fund tracks the CRISIL IBX 50:50 Gilt Plus SDL Index, which includes government bonds and state government bonds in roughly equal proportions. The fund’s Net Asset Value (NAV) fluctuates periodically based on changes in interest rates and the yields of these bonds, particularly in the period leading up to maturity.

Fund Details:

Details	Information
Current NAV	12.84
Fund Size	144.84
Expense Ratio	0.20
Minimum Investment	100
Minimum SIP	100
Exit Load	Nill
Fund Manager	Pranavi Kulkarni
1-year return	8.33
3-year return	8.18

Types of Target Maturity Funds Available in India

Gilt Target Maturity Funds: Gilt Target Maturity Funds invest in central government bonds, therefore they have very low credit risk. While NAV fluctuations may occur initially due to interest rate movements, the risk is significantly reduced if held until maturity. This option is considered suitable for safety-conscious investors.
SDL Target Maturity Funds: SDL Target Maturity Funds invest in state government bonds. They may offer slightly better yields compared to Gilt Funds. The risk remains limited, but it’s important to consider liquidity and interest rate fluctuations. This fund is suitable for investors seeking balanced returns.
PSU and Bharat Bond Target Maturity Funds: These funds invest in bonds of public sector undertakings (PSUs) and government-backed entities, where government support is present. The risk level is low to moderate, and returns are typically slightly better than Gilt Funds. This option is useful for those seeking secure and stable income.

Key Risks Associated with Target Maturity Funds

Interest Rate Risk: If interest rates change before maturity, the fund’s NAV may fluctuate. This fluctuation can be more pronounced in longer-term funds.
Early Exit Risk: These funds are open-ended, but if an investor withdraws money prematurely, the prevailing market conditions at that time can affect the returns.
Reinvestment Risk: When reinvesting after the fund matures, interest rates may be lower, which could limit future returns.
Tracking Error: Since these are index-based funds, the fund’s performance may sometimes deviate slightly from its underlying index.
Liquidity Risk: In some schemes, low trading volume can slightly impact the NAV at the time of exit, especially during periods of market volatility.

Conclusion

Target Maturity Mutual Funds are designed for investors who seek a defined timeframe and a relatively stable structure within the debt segment. The key features of these funds are their fixed maturity date and bond-based structure, which makes the investment behavior easier to understand. However, they are still subject to the impact of interest rate fluctuations, and should be viewed with that in mind. Overall, Target Maturity Funds offer a distinct approach to intelligently managing a debt portfolio.

Start your investing journey with Pocketful. Enjoy low fees and powerful tools like Pockets, Scalper, and Pocketful GPT. Everything is built to help you trade smarter, faster, and with more confidence.

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Frequently Asked Questions (FAQs)

What are Target Maturity Mutual Funds?
These are debt funds that have a fixed maturity date and track a bond index.
Do Target Maturity Funds give fixed returns?
No, their returns are not fixed; they depend on bond yields and interest rates.
Is the NAV stable in Target Maturity Funds?
The NAV is usually stable closer to maturity, but fluctuations are possible before that.
Can money be withdrawn before maturity?
Yes, these are open-ended funds, but early withdrawal may affect the NAV.
Are Target Maturity Funds risk-free?
They are not entirely risk-free, but the credit risk is generally low.

January 7, 2026

Best Performing Mutual Funds of the Last 10 Years

Short-term returns can be tempting in mutual fund investing, but they do not always reflect the complete picture. Markets fluctuate over time, and a fund that looks like a top performer today may not remain one in the future. That is why evaluating mutual fund performance over a longer period is important while selecting them. A decade-long track record shows how a fund has handled different market phases over time.

In this blog, we look at some of the best-performing mutual funds over the last 10 years.

What are Mutual Funds?

Mutual funds are a way to invest your money without having to pick individual stocks or bonds yourself. Your money is pooled together with other investors and managed by a professional fund manager, who invests it across shares, bonds, or other asset classes. Your risk is spread out because of diversification across multiple securities.

Why 10-Year Returns are Important – Reviewing a fund’s 10-year returns helps you see the bigger picture. Over a decade, markets go through multiple phases, rallies, corrections, and even crashes.A fund that performs well over this period demonstrates resilience across different market conditions. Long-term returns also tell you how consistent a fund has been and make it easier to ignore short-term noise.

List of Best Performing Mutual Funds of the Last 10 Years

S. No	Fund Name	Category	10 Year Returns (in%)	AUM	Current NAV	Fund Manager	Min SIP	Min Investment
1	Quant ELSS Tax Saver Fund	Equity -ELSS	21.47	12,514 Cr	426.2708	Ayusha Kumbhat/Sameer Kate	500	500
2	Nippon India Small Cap Fund	Equity – Small Cap	20.9	68,572 Cr	187.055	Samir Rachh	100	5,000
3	Invesco India Mid Cap Fund	Equity – Mid Cap	20.11	10,006 Cr	222.95	Amit Ganatra	500	1,000
4	Edelweiss Mid Cap Fund	Equity – Mid Cap	19.99	13,196 Cr	123.069	Trideep Bhattacharya/Dhruv Bhatia/Raj Koradia	100	100
5	Quant Small Cap Fund	Equity – Small Cap	19.99	30,170 Cr	275.0669	Ayusha Kumbhat/Sameer Kate	1,000	5,000
6	DSP Natural Resources and New Energy Fund	Equity- Thematic	19.78	1,467 Cr	108.836	Rohit Singhania	100	100
7	Kotak Midcap Fund	Equity – Mid Cap	19.46	60,480 Cr	159.316	Atul Bhole	100	100
8	HDFC Mid Cap Fund	Equity – Mid Cap	19.39	92,169 Cr	225.488	Chirag Setalvad	100	100
9	Nippon India Growth Mid Cap Fund	Equity – Mid Cap	19.15	42,042 Cr	4,656.03	Rupesh Patel	100	100
10.	SBI Technology Opportunities Fund	Equity-Sectoral	18.90	5,130 Cr	267.6166	Vivek Gedda	500	5,000

Overview of Top Performing Mutual Funds of the Last 10 Years

1. Nippon India Small Cap Fund

Nippon India Small Cap Fund is meant for investors who are comfortable taking higher risk in exchange for long-term growth. The fund was launched in 2010. It invests mainly in small and emerging companies that have the potential to grow over time. While returns can be volatile in the short term, the fund has rewarded investors who stay invested for longer periods and can handle ups and downs. Return since launch is 20.12%. Exit Load stands at 1% for redemption within 1 year. Benchmark is NIFTY Smallcap 250 TRI. Top holdings of the fund include MCX, HDFC Bank, SBI, Karur Vyasa Bank, BHEL, etc.

2. Quant ELSS Tax Saver Fund

Quant ELSS Tax Saver Fund is a good option for investors for long-term wealth creation, along with tax benefits under Section 80C. Launched in January 2013, the fund is managed by Quant Mutual Fund and follows an investment strategy that adapts to changing market cycles. The fund falls under the ELSS category and has a lock-in period of three years. It invests across large, mid, and small-cap stocks, offering diversification within equities. The benchmark of the fund is NIFTY 500 TRI Index.

3. Invesco India Mid Cap Fund

Invesco India Mid Cap Fund is designed for investors looking for long-term capital appreciation by investing in mid-cap Indian companies. The fund was launched in April 2007. The fund invests primarily in mid-cap stocks that offer a balance between growth potential and business stability. With a moderately high risk profile, it is suitable for investors who can stay invested for the long term. Return since launch is 21.55%. An exit load of 1% will be charged for redemption within 365 days. Top holdings of the fund include The Federal Bank, AU Small Fin Bank, L&T Fin, Swiggy, BSE, etc.

4. Edelweiss Mid Cap Fund

Edelweiss Mid Cap Fund aims to generate long-term capital growth by investing in fundamentally strong mid-cap companies. Launched in January 2013. It carries a moderately high risk profile. Return since launch is 22.07% and has 1% exit load for redemption within 90 days. Top holdings of the fund include Coforge, Persistent Systems, BSE, Indian Bank, etc. The benchmark of the fund is NIFTY Midcap 150 TRI.

5. Quant Small Cap Fund

Quant Small Cap Fund is suitable for investors seeking aggressive long-term growth through small-cap companies. The fund was launched in January 2013 and invests primarily in small-cap stocks across sectors and carries a high-risk profile. Return since launch is 17.51% annualized and has a 1% exit load for redemption within 365 days. Top holdings of the fund include Reliance, Jio Financial, RBL Bank, Aegis Logistics, Adani Power, etc. The Benchmark of the fund is NIFTY Smallcap 250 TRI.

6. DSP Natural Resources and New Energy Fund

This is a thematic equity fund suitable for investors looking to benefit from global and domestic trends in energy, commodities, and natural resources. The fund was launched in April 2007. The fund invests in companies related to natural resources, power, energy, and allied sectors. Due to its thematic nature, it carries a very high-risk profile. Returns since launch are 17.52%. Exit Load is nil. Benchmark is MSCI World Energy 10/40 Net TRI (35), BSE Oil & Gas TRI (35), BSE Metal TRI (30). Top Holdings are ONGC, Jindal Steel, Tata Steel, Black Rock Global Funds, Etc.

7. Kotak Mid Cap Fund

The fund was launched in September 2014. The fund invests across diversified mid-cap stocks and follows a bottom-up stock selection approach. With a moderately high risk profile, it is suitable for investors aiming for long-term wealth creation. Returns since launch are 20.60%. Exit Load 1% will be charged for redemption within 365 days. The Top Holdings of the fund are GE Vernova T&D, Fortis Healthcare, Mphasis, Ipca Laboratories, etc.

8. HDFC Mid Cap Fund

Launched in July 2007, it belongs to India’s most trusted and experienced mutual fund houses. The fund invests in quality mid-cap companies with sustainable business models and strong management. It carries a moderately high risk profile and is suitable for long-term investors seeking consistent growth through exposure to mid-sized companies. Returns since launch are 21.06%. Benchmark of the fund is NIFTY Midcap 150 TRI. Exit Load is 1% for redemption within 365 days. The Top Holdings of the fund are Max Financial, AU Small Fin Bank, The Federal Bank, Indian Bank, Balkrishna Ind., etc.

9. Nippon India Growth Mid Cap Fund

Nippon India Growth Mid Cap Fund is designed for investors looking to build wealth. It was launched in October 1995 and is one of the oldest mid-cap funds. With a moderately high risk profile and a proven long-term track record, it is suitable for investors. Returns since launch are 18.63%. Benchmark is NIFTY Midcap 150 TRI. Exit Load is 1% for redemption within 30 days. Top Holdings of the fund are BSE, Fortis, Federal Bank, AU Small Fin Bank, etc.

10. SBI Technology Opportunities Fund

This fund is meant for investors who want focused exposure to India’s fast-growing technology and digital sectors. Since it is a sector-focused fund, returns can be volatile in the short term. It is best suited for long-term investors who believe in the technology growth story. Returns since launch are 20.84%. Exit Load is 0.5% for redemption within 15 days. Benchmark is BSE Teck TRI. Top Holdings of the fund are Infosys, Bharti Airtel, Coforge, LTI Mindtree.

Conclusion

Strong 10-year returns do not guarantee future performance, but they do highlight funds that have shown consistency and discipline over time. Remember, these fund rankings can also vary and are subject to changes depending on multiple scenarios. For example, a change in fund manager may impact a fund’s performance positively or negatively. Also, match these funds with your goals, risk comfort, and investment horizon and consult your financial expert before making any investment decision.

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Frequently Asked Questions (FAQs)

Are mutual funds with high 10-year returns safe?
Not always, strong past returns show consistency, but every fund carries market risk.
Should I invest only based on past performance?
No. Past performance can be helpful, but you should also consider other factors like fund category, risk, objective, etc.
Is SIP better than a lump sum for long-term funds?
Although both modes of investment give similar returns, if you are a retail investor, SIPs will work better.
How often should I review my mutual fund investments?
You should review your mutual fund investments every 6 months.
Can beginners invest in long-term mutual funds?
Beginners can start with SIPs and focus on diversification of portfolio to spread out the risk.

January 7, 2026

Daily SIP vs Monthly SIP: Which SIP is Better?

Mutual funds as an investment option are gaining popularity because of their simplicity in creating wealth in the long run. There are two ways of investing in a mutual fund: lump sum and SIP. However, investors often get confused between a daily and a monthly SIP.

In today’s blog post, we will give you an overview of which one is better: daily SIP or a monthly SIP.

What is Daily SIP?

A daily sip is a mode of investing in a mutual fund in which an investor invests a particular amount on a daily basis instead of a monthly or quarterly basis. It spreads your investment evenly throughout the business days, which generally range from 20 to 22 days in a month. Daily SIP increases the benefit of rupee cost averaging. Start your investing journey with Pocketful for a smooth and disciplined experience.

Benefits of Daily SIP

The key benefits of daily SIP are as follows:

Rupee Cost Averaging: Through daily SIP, one can get the enhanced benefit of rupee cost averaging because the purchases through SIPs are executed daily.
Market Timing: As the investments are spread across the trading days, the impact of market volatility will be minimised.
Correction: In case of market correction, daily SIP invests more frequently at a lower NAV, which allows an investor to accumulate more units.

Disadvantages of Daily SIP

The key disadvantages of daily SIP are as follows:

Less Convenient: Daily SIP includes numerous transactions during a month, which makes it difficult for a retail investor to track, as they prefer simplicity.
Limited Availability: Not every mutual fund scheme offers a daily SIP option, as investors lack flexibility.
Cash Flow: Maintaining regular cash in one’s bank account is difficult and makes it inconvenient for a retail investor who receives a salary as a major source of income.

What is a Monthly SIP?

A monthly SIP is a systematic mode of investment in a mutual fund in which an investor invests a fixed amount every month in a scheme on a pre-defined date. It is one of the most common modes of SIP used by a retail investor. The units are allotted based on the applicable date of the NAV on which the SIP is deducted.

Read Also: SIP vs Lump Sum: Which is Better?

Benefits of Monthly SIP

The key benefits of monthly SIP are as follows:

Easy to Manage: As the SIP is deducted only once a month, therefore for a retail investor to manage and track the SIP investment.
Acceptance: Monthly SIPs are offered by all the asset management companies; hence, offering a wide range of choices to select from schemes.
Flexibility: Monthly SIPs can be paused, stopped or increased at any point in time depending upon the investor’s need.

Disadvantages of Monthly SIP

The disadvantages of a monthly SIP are as follows:

Less Effective: In case of a highly volatile market, the monthly SIPs are less effective as they do not capture the NAV movements.
Opportunity: Monthly SIPs can miss the opportunity to buy more units in case of a market correction.
Active Investors: Investors who seek active averaging or do not want to miss any opportunity related to any market correction can consider a daily SIP instead of a monthly SIP.

Difference between Daily and Monthly SIP

The key differences between daily and monthly SIP are as follows:

Particular	Daily SIP	Monthly SIP
Frequency	It is deducted on every trading session of a month.	Monthly SIPs are deducted only once a month.
Market Timing	Daily SIPs can time the market in a better manner.	Monthly SIPs time the market less efficiently.
Convenience	It is less convenient.	Monthly SIPs are very convenient.
Tracking	It is difficult to track daily SIP.	Comparatively, it is very simple to track a monthly SIP.
Availability	Daily SIPs have limited availability across fund houses.	Monthly SIPs are widely available and are offered in every mutual fund scheme.
Rupee Cost Averaging	It offers a higher benefit of rupee cost averaging.	It offers slightly less benefit of rupee cost averaging than daily SIPs.
Allotment of NAV	NAVs are allotted daily.	In a monthly SIP, NAVs are allotted once a month.

Best Mutual Funds for SIP

Funds	Expense Ratio (%)	AUM (Cr)	1 Yr Ret (%)	3 Yr Ret (%)	5 Yr Ret (%)	Latest NAV	52-Week High NAV	52-Week Low NAV	Exit Load (Period)	Minimum SIP Amount (INR)
HSBC Global Emerging Markets Fund	1.55	306	40.84	17.03	6.01	25.98	26.05	17.44	1.00 (365)	1000
Franklin Asian Equity Fund – Regular Plan	2.54	297	22.57	12.2	3.1	35.32	35.66	25.9	1.00 (365)	500
Quant BFSI Fund – Regular Plan	2.32	729	22.16	—	—	19.27	19.27	13.77	1.00 (15)	1000
ICICI Prudential Nifty Auto Index Fund	0.94	176	21.08	30.24	—	21.88	22.09	15.61	—	1000
Tata Nifty Auto Index Fund – Regular Plan	1.11	102	20.77	—	—	12.44	12.56	8.89	0.25 (15)	100

(As of 26th December 2025)

Which one is better?

Investors who want consistent investment in the market without worrying about the daily bank balance can consider a daily SIP as an investment mode. On the other hand, those who want simplicity and convenience in investing can opt for a monthly SIP. Both of them offer rupee cost averaging benefits and are suitable for long-term wealth creation.

Conclusion

In conclusion, both daily and monthly SIPs are crucial tools for creating wealth in the long run. Daily SIPs are comparatively better than monthly SIPs in terms of rupee cost averaging, as investments are made more frequently. However, for a retail salaried individual, monthly SIPs are a better option, as they are easy to manage and straightforward. However, both of them are suitable only if the investments are made in a disciplined manner. Also, it is advisable to consult your investment advisor before investing.

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Frequently Asked Questions (FAQs)

Which is better daily or a monthly SIP?
Over a longer period of time, the difference in returns of daily and monthly SIPs is negligible. Hence, anyone can choose between them depending on their needs.
Do all funds offer daily SIP?
No, not all mutual fund schemes offer daily SIP. There are very few funds available in the market in which one can invest through a daily SIP.
Can I switch from a monthly SIP to a daily SIP?
Yes, you can easily switch from a monthly SIP to a daily SIP by stopping the monthly SIP and starting a new daily SIP at any time.
What is a daily SIP?
Daily SIP is a mode of investment in a mutual fund in which a fixed amount of money is deducted from the investor’s bank account daily or on a trading day and invested in the designated scheme or fund.
Are there any extra charges for a daily SIP?
No, there are no additional charges for any daily SIP. The fund expense ratio remains the same for both monthly and daily SIP.

January 5, 2026

Portfolio Manager vs Hedge Fund Manager: Key Differences

In today’s world, professional fund management plays a crucial role in creating wealth. There are various professionals available in the investment world who manage investors’ funds. Among them, portfolio managers and hedge fund managers are commonly chosen by the investors.

In today’s blog post, we will give you an overview of portfolio managers and hedge fund managers, along with the key differences between them.

What is a Portfolio Manager?

A portfolio manager refers to a person whose main job is to manage portfolios either on behalf of individuals or institutions. The portfolio of the portfolio manager comprises various types of assets such as equities, bonds, mutual funds, ETFs, etc. A portfolio manager usually works with mutual fund companies, pension funds, insurance companies, etc.

Features of a Portfolio Manager

The key features of a portfolio manager are as follows:

Diversify Portfolio: Their primary objective is to manage the portfolio and diversify it according to the investment objective.
Company Fundamentals: They must analyse the company’s fundamentals so that the correct investment can be made.
Risk and Return: A Portfolio manager should balance the risk and return of a portfolio. They try to generate maximum return by taking minimum risk.
Compliance: They must maintain compliance with the regulatory guidelines laid down by the agencies.

What is a hedge fund manager?

A hedge fund manager is a person who manages the pooled fund of different high-net-worth individuals. They primarily use advanced trading strategies which carry high risk to generate profit on investment. They do not worry about the market trend and change their strategies according to it.

Features of a Hedge Fund Manager

The key features of a hedge fund manager are as follows;

Complex Strategies: They develop complex investment strategies to generate returns.
Leverage: A Hedge fund manager uses leverage to enhance the return of the portfolio.
Short-Selling: They also use short-selling strategies to manage risk and market exposure actively.
Absolute Return: They do deliver absolute returns rather than benchmark-based returns.

Difference between Portfolio Manager and Hedge Fund Manager

The key differences between a portfolio manager and a hedge fund manager are as follows:

Particular	Portfolio Manager	Hedge Fund Manager
Investment	A portfolio manager primarily invests in different vehicles such as mutual funds, PMS, ETFs, etc.	A hedge fund manager invests in a hedge fund and an alternative investment fund.
Target Investors	Portfolio managers primarily target retail and institutional investors.	Hedge funds focus on high-net-worth and accredited investors.
Objective	Their objective is to generate long-term risk-adjusted return.	The objective of a hedge fund manager is to generate an absolute return irrespective of market conditions.
Strategy	A conservative investment strategy is used by portfolio managers.	Hedge fund managers use aggressive investment strategies.
Leverage	They do not use leverage.	Hedge fund managers use extensive leverage to enhance returns.
Transparency	Portfolio managers offer high transparency.	They offer comparatively lower transparency.
Fees	They charge a fixed fee.	Hedge fund managers charge performance-based fees.
Short Selling	Portfolio managers rarely use short-selling.	Short-selling is commonly used by hedge fund managers.
Risk	Investing with portfolio managers carries low to moderate risk.	Investing with a hedge fund manager carries high risk.

Who should invest with a portfolio manager?

Investment with a portfolio manager will be beneficial to the types of investors listed below:

Goal-Oriented: Investors who have long-term goals and want to create wealth over time can invest with the portfolio managers.
Conservative Investor: Portfolio managers work towards the preservation of capital; hence, they are best suited to investors who tend to have reduced volatility and predictable returns.
Liquidity: Most of the portfolio managers allow easy entry and exit, which makes them suitable for investors looking for liquidity in their portfolio.

Who should invest with a hedge fund manager?

The following are the types of investors who can invest with a hedge fund manager:

High-Net-Worth Investor: Hedge funds typically require a large ticket size or investment level; thus, they are only available to high-net-worth individuals.
Risk-Taking Investor: Because of complex trading strategies, hedge funds generally carry high risk. Therefore, investors with high risk tolerance can invest with a hedge fund manager.
Experienced: Investors who understand the market and are well-versed in the market dynamics and complex trading strategies can invest with a hedge fund manager.

Conclusion

To conclude, portfolio managers, as well as hedge fund managers, are important in investment and increasing wealth. They have different approaches to generating returns. On one hand, a portfolio manager is targeting long-term wealth generation and capital retention; on the other hand, a hedge fund manager is targeting absolute return through a wide range of aggressive trading and investments. The selection between them, however, is based on the risk profile of an investor and their investment purpose.

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5	Difference Between Large Cap vs Mid Cap Mutual Fund

Frequently Asked Questions (FAQs)

Who regulates the portfolio manager and hedge fund manager in India?
Securities and Exchange Board of India (SEBI) regulates portfolio managers and hedge fund managers.
What are the most common investment strategies used by the hedge fund manager?
Arbitrage, short-selling, derivatives, leverage, etc, are the most common investment strategies employed by a hedge fund manager.
Investing with a portfolio manager or a hedge fund manager, which is riskier?
The investment with hedge fund managers is usually regarded as risky due to leverage and complicated trading strategies, and the portfolio manager focuses on capital protection and stable returns.
Who charges more fees, a hedge fund manager or a portfolio manager?
Hedge fund managers charge higher fees because they use more complicated strategies of trading strategies; their fees are fixed fees and performance-based fees; the portfolio managers have a fee that is fixed fee only.
Can a hedge fund manager guarantee profit?
No, a hedge fund manager does not guarantee profit, as all the investments are market-linked.

December 31, 2025

What Is a Chit Fund?

Imagine you need Rs.30,000 for a medical emergency. But you don’t want the hassle of bank paperwork, and don’t want to pay high interest on a personal loan. What do you do? For millions of Indians: they turn to a Chit Fund.

You might have heard your parents or neighbors talk about “putting money in a chit.” But what is a chit fund? It is a system where a group of people come together to save money and help each other borrow money whenever they require it.

It is one of India’s oldest financial tools. Long before modern banks existed, villagers would pool money to help a neighbor in need. Today, this tradition has evolved into a big industry. In this blog, we will decode chit fund meaning, how chit funds work, and whether Indian chit funds are safe.

What is a Chit Fund?

A Chit Fund is a time-honored financial arrangement that effectively serves as a hybrid of both borrowing and disciplined saving. This is a formal contract between a manager also known as Foreman and a fixed group of individuals known as subscribers. This group agrees to contribute a predetermined, fixed amount of money every month for a fixed period of time, typically equal to the number of members, thus creating a revolving cash “pot” or “chit value” in each cycle. The main principle operating behind this is, every month one individual from the subscribers group gets to take a lump sum money of the pot, but the receiver is determined through a dynamic, competitive reverse auction (or draw of lots). In the auction, members who have instant needs of funds bid by offering a discount on the whole pot amount. The person that accepts the lowest sum (meaning who offers maximum discount) wins the pot amount for that particular month. Here a small commission is deducted by the foreman for managing the whole scheme, and the remaining amount is distributed equally amongst the subscribers of the scheme as dividend, this effectively reduces the net monthly installment for every member. The early winners access funds for urgent requirements (which acts as a loan) while winners that get late benefits of their continuous savings and higher dividends (this acts as an investment), with all subscribers continuing to pay their part till the cycle ends.

To understand how chit funds work, you need to know four simple terms:

Foreman: The organizer or manager. This can be a person or a company (like Shriram Chits). They collect the money, run the show, and keep records.
Subscriber: This is the member who puts money in.
Chit Value (The Pot): The total money collected in a month.
Dividend: This is the profit earned. When someone takes the pot early, they usually agree to take a little less money. The money they leave behind is shared with everyone else.This extra money reduces the next monthly payment.

How Chit Funds Operate

Group Formation: A Foreman (the organizer) sets up and manages the fund operations for a fixed period.
Monthly Contribution: Each participant contributes a set installment (e.g., Rs.5,000). The monthly Pot is formed by the total collection.(e.g., 20 members for Rs.5,000 = Rs.1,00,000).
The Auction: The Pot is bid by the members who need cash immediately. They win by agreeing to take the money at a discount.
The Dividend: The Foreman’s fee is paid by the amount saved from the winning bid and remaining amount is divided equally among all members as a Dividend.This dividend effectively reduces their next month’s payment.
Cycle Continues: This process repeats monthly until every member has had a chance to receive the total pooled amount once.

This system is dual-purpose: it functions as a Savings Tool and a Borrowing Option (if you take the lump sum early).

Benefits of Chit Funds

Easy to Join: A high credit score or stacks of income proof documents is not required. If the Foreman trusts you, you are in.
Forced Savings: We have to pay every month so discipline is required here which helps in building a big saving habit.
Emergency Cash: This acts like an instant loan. In an emergency, you can bid in the auction and get the money quickly without waiting for loan approvals.
Dual Benefit: Interest (dividends) are earned if you wait till the end. If you bid early, you get a loan. It serves both borrowers and savers.

Risks Involved in Chit Funds

The Vanishing Act: The biggest risk is joining an “Unregistered” chit fund run by a local guy. You might have very little legal power to get the money if he runs away with it.
Default Risk: If money is taken by Member A and then the monthly installments are stopped by him, then the loss has to be covered by the Foreman, but if too many people default, the whole system collapses.
Scams: “Chit Funds” is often used by many frauds to trick people. The famous Saradha Scam was operated as a Ponzi scheme that promised high fixed returns, which real chit funds never do.

Rules and Regulations

To protect everyone from scams, the government created the Chit Funds Act, 1982:

Registration is Mandatory: Every chit fund company should be registered with the State Government.
Security Deposit: Foreman must deposit 100% of the pot value in a bank account controlled by the Registrar before starting a chit group. This ensures that even if the company shuts down, the money is safe.
Commission Cap: The Foreman cannot charge more than a 5% fee (plus GST) for their services.
Dispute Resolution: If a problem occurs, then visiting a regular court is not required, the Registrar of Chits helps in such a situation for a faster solution.

How to Identify a Safe Chit Fund

Ask for the PSO Number: Every chit group has a “Previous Sanction Order” (PSO) from the Registrar, It is important to check it once.
Check for “Registered”: Join only those companies that are registered. Examples include Shriram Chits, Margadarsi, or government-run ones like KSFE (in Kerala) etc.
No “Double Your Money” Promises: A fixed return is never promised by a Real chit fund.The return depends on the auction. If someone promises a fixed profit then it is likely a scam.
Read the Agreement: An agreement shall be signed which should consist of details like date, amounts and penalties.

Chit Funds vs. Other Investments

Chit Fund vs Mutual Fund: Mutual funds are designed for long-term capital, delivering market-linked returns regulated by SEBI. Chit funds function as a system of forced saving with a mechanism for short-term internal loans.
Chit Fund vs Fixed Deposit: Fixed Deposits offer the maximum safety offered with fixed deposits and guarantees a fixed interest rate.Chit fund earnings are unpredictable as the final dividend depends on the bids placed by the members every month.
Chit Fund vs Recurring Deposit: They both require monthly contributions consistently. The primary distinction is that RDs are purely savings, while chit funds offer the ability to receive a lump-sum cash advance (borrowing) with the monthly auction.

Conclusion

One should invest in chit Funds but only if you choose a Registered Chit Fund. It is a beneficial tool for a small business owner, a freelancer, or someone who needs access to funds without begging a bank. It teaches discipline and helps you in emergencies. However, if looking for pure investment growth with zero effort, one must stick to Mutual Funds or Fixed Deposit.

The company’s license should be verified every time. It should be used for short-term goals (like buying a fridge or funding a wedding), not for retirement.

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5	Debt Mutual Funds: Meaning, Types and Features

Frequently Asked Questions (FAQs)

Is the money from a chit fund taxable?
The main prize money is not taxable because it is just your own savings coming back.
What happens if the Chit Fund company runs away?
If it is a Registered company, your money is safe. The Registrar holds a security deposit equal to the chit value, which can be used to pay you back.
Can a chit fund be left in the middle?
Yes, but it is costly. A substitute member should take the place, and the company usually charges a penalty (around 5%) for the exit.
Is a Chit Fund better than a Personal Loan?
Often, yes. Personal loans have high processing fees and strict interest rates. In a chit fund, the “interest” you pay is just the discount you bid, which often works out cheaper, and there is no processing fee.
How much return can one expect?
It varies because it depends on how desperate other members are to bid. Though one can expect a return of around 8% to 10% per year.

December 29, 2025

Top Specialized Investment Funds (SIFs) in India 2026

Investing has changed a lot over the past few years, and one of the recent additions in 2025 is the rise of Specialized Investment Funds (SIFs). With features of derivatives and the flexibility of mutual funds, SIFs give investors a dynamic way to handle different market conditions. In this blog, we will walk through what SIFs are, who they are ideal for, and the top SIFs launched in India so far.

What is SIF?

A Specialized Investment Fund (SIF) is a new kind of investment option in India that sits right between regular mutual funds and high-ticket PMS/AIF products. Consider it as a middle path: more flexible than a mutual fund but far more feasible than PMS or AIF, which usually require very large investments.

With SIFs, AMCs get the freedom to use more advanced strategies, like long-short investing, derivatives, or a mix of equity and debt, all under SEBI rules. And for investors, the entry barrier is much lower compared to PMS or AIF. SIFs start with a minimum investment of ₹10 lakh. They bridge a long-existing gap between MF & PMS/AIF.

Top Specialized Investment Funds 2026

1. Quant Mutual Fund – QSIF Range

Quant offers some of the most active strategies in the market.
Their SIF range includes:

Equity Long-Short Fund -Targets mid- and small-cap opportunities while using short positions to control risk.
Hybrid Long-Short Fund – A mix of equity, debt, and derivatives for a more balanced feel.
Equity Ex -Top 100 Long-Short Fund – Focuses on companies outside the top 100, with higher potential but higher volatility too.

2. Edelweiss Mutual Fund – Altiva SIF

Edelweiss runs its SIFs under the Altiva brand

Their main product is a Hybrid Long-Short Fund that spreads money across equity, debt, arbitrage, and even special situations.
It is curated in such a way that it can stay steady in both good and bad markets by managing risk smartly.

3. SBI Mutual Fund – Magnum SIF

SBI has created one of the most versatile SIFs called Magnum SIF.

Their core strategy is a Hybrid Long-Short Fund that shifts between equity, debt, and derivatives depending on market conditions.
The objective is to keep returns smoother rather than letting the portfolio swing wildly.

4. Union Mutual Fund – Arthaya SIF

Union MF offers its SIF under the name Arthaya SIF.

This platform blends equity, debt, and derivatives using a long-short approach.
It seems more measured and steady compared to the more aggressive AMCs.

5. Bandhan Mutual Fund – Arudha SIF

Bandhan AMC has stepped into the SIF with Arudha SIF.

The fund uses equity, debt, and derivative-based long-short strategies.
The idea is to offer something more flexible and advanced than a basic mutual fund.

6. ITI Mutual Fund – Divinity SIF

ITI MF runs its SIF under Divinity SIF.

The key offering is the Divinity Equity Long-Short Fund, which tries to capture upside while protecting the investors against downturns.
It uses long-short investing to balance growth and safety.

7. 60 ONE – Dyna SIF

360 ONE (formerly IIFL Wealth) offers its SIFs under the Dyna SIF brand. These funds follow long-short and multi-asset strategies with an institutional, risk-managed approach.

Read Also: Best Investment Options in India

Who Should Invest in SIFs?

Someone who wants more flexible strategies – If you feel traditional mutual funds are too boring and you are curious about derivatives, SIFs are a great option.
Anyone investing with a medium- to long-term mindset – SIFs generally work better if you are willing to stay invested for 3-5 years or more. Not ideal for someone who wants to exit quickly.
Investors comfortable with the ₹10 lakh minimum – Most SIFs require at least ₹10 lakh, so they’re a good fit for HNIs, seasoned investors, family offices, etc.
People who want MF transparency but PMS/AIF-style strategies – SIFs sit perfectly in the middle; you get the comfort of mutual fund regulation, but with the kind of strategies usually seen in PMS or AIF products.

Conclusion

Although SIFs are relatively new to the investment space, they have already gained popularity. If you do not have a problem with taking extra risk for a better overall investment strategy, then you should consider including SIFs as a part of your portfolio. Before investing, you should understand how they work, learn about the minimum investment amount and find a known fund house. With a long-term perspective, you will be able to add further strength and stability to your wealth-creation goals using SIFs.

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11	Mutual Fund Fees & Charges in India
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13	History of Mutual Funds in India
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15	Types of Mutual Funds in India
16	What is a Fixed Income Mutual Fund?
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18	Best Thematic Mutual Funds in India

Frequently Asked Questions (FAQs)

What is the minimum investment for SIFs?
Most SIFs require a minimum investment of ₹10 lakh.
Are SIFs riskier than mutual funds?
Yes, they can be, because they use derivatives, long-short strategies, and dynamic allocations.
Can beginners invest in SIFs?
It is not recommended. SIFs are better suited for experienced investors who understand market risks.
Are SIFs regulated by SEBI?
Yes, SIFs are regulated by the SEBI.
How are SIFs different from PMS/AIF?
SIFs require lower investment, have more transparency, and are more accessible than PMS/AIF, but still offer advanced strategies.

December 26, 2025

Difference Mutual Funds and Hedge Funds?

In today’s world of investment, there are various options which confuses investors about which option is suitable for them. A few of such options include mutual funds and hedge funds, each offering different risk levels, strategies, and returns, making it essential for investors to understand their goals clearly.

In today’s blog post, we will give you an overview of mutual funds and hedge funds, along with their differences and in the end, will tell you which one is suitable for you.

What are Mutual Funds?

A Mutual Fund is an investment product which is offered by Asset management companies. In which the company collects funds from investors and appoints a fund manager to manage such funds by investing them in different assets, such as stocks, bonds, etc.

Features of Mutual Funds

The key features of a mutual fund are as follows:

Professionally Managed Funds: The funds invested by the investors are managed by professional fund managers, who have vast experience in fund management.
Diversified Portfolio: The fund is invested by the fund manager in different asset classes such as bonds, equity, gold, etc., which reduces overall risk.
Low-cost: The fees charged by the asset management company are very low compared to other investment options.
Affordable: One can start their investment in mutual funds by investing a minimum of INR 100 – 500.

What are Hedge Funds?

A Hedge Fund is managed privately by the fund manager that pools money from various HNI investors, including retail and institutional investors. They use aggressive strategies such as short-selling, derivatives, etc., to generate returns. The hedge funds have limited regulations, unlike mutual funds.

Features of Hedge Funds

The key features of hedge funds are as follows:

Aggressive Investment Strategy: Hedge funds employ high-risk, aggressive investment strategies, including short-selling, leverage, and derivatives.
HNI Investors: Retail and institutional investors who have high net worth can consider investing in hedge funds.
Performance Fees: Hedge funds generally charge performance-based fees, in addition to a fixed fee structure. However, the type of fees depends on the asset management company.

Difference Between Mutual Funds and Hedge Funds

The key differences between mutual funds and hedge funds are as follows:

Particular	Mutual Fund	Hedge Fund
Investor	Mutual funds are allowed for all kinds of investors, especially for retail investors.	Hedge funds are allowed for high-net-worth individuals and institutional investors.
Returns	These funds aim to outperform the benchmark or give returns similar to the benchmark.	Hedge funds aim to give a positive return in every market condition.
Strategies	Fund managers in mutual funds do not use any complex strategies.	Complex strategies such as derivatives, short-selling, etc., are used by the fund manager.
Regulated	Mutual funds are strictly regulated by the Securities and Exchange Board of India.	They are comparatively less regulated than mutual funds.
Transparency	Mutual funds offer high transparency with respect to portfolio disclosure, etc.	Hedge funds offer comparatively low transparency compared to mutual funds.
Fees	It charges low fees for managing funds.	Hedge funds charge higher fees when compared to mutual funds.
Minimum Investment	The minimum investment amount in mutual funds starts from INR 100.	In the case of hedge funds, the minimum investment amount is 1 crore.

Mutual Fund vs Hedge Fund – Which is better?

The decision between the mutual fund and the hedge fund will depend on the risk profile of the investor and their investment objective. They can invest in mutual funds in case they want to invest in a low-cost investment option with moderate risk and return. However, if you want to get a higher return and are willing to take a higher risk, then you can choose to invest in hedge funds; however, they charge higher fees than mutual funds.

Conclusion

On a concluding note, both mutual funds and hedge funds are suitable for different classes of investors. If you have a high net worth and are comfortable with taking high risk, then a hedge fund is a suitable investment option for you, as we know that with higher risk comes higher returns; therefore, hedge funds offer higher returns. Whereas, on the other hand, mutual funds are suitable for investors looking for investment products with moderate risk and returns. However, it is advisable to consult your investment advisor before making any investment decision, and require deeper market understanding, stricter eligibility, and patience to navigate complex strategies aimed at maximizing wealth while managing volatility and long-term financial goals effectively.

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Frequently Asked Questions (FAQs)

What are the key differences between mutual funds and hedge funds?
The key differences between mutual funds and hedge funds are related to their fees, investment amount, and fund management style.
Who can invest in hedge funds?
In hedge funds, all types of investors can invest their money, but they are generally open to accredited or high-net-worth individuals or institutional investors, because of their risky investment strategies.
What is the fee structure of hedge-funds?
Hedge funds charge higher fees than most other investment options. They follow two types of fee structure, which include fixed AUM-based fees, and the other one is performance-based fees; however, there are a few asset management companies which offer a combination of both types of fees.
What is the minimum investment amount for hedge funds and mutual funds?
The minimum investment required in mutual funds is INR 100, but in the case of a hedge fund, it is INR 1 crore.
Can hedge funds or mutual funds offer guaranteed returns?
No, hedge funds or mutual funds both of them do not offer guaranteed returns. The investment is made in market-related instruments, which can lead to volatility and inconsistent returns.

December 23, 2025

Category: Mutual Funds

Best SIP Mutual Funds in India

How to Choose the Best SIP Mutual Funds

List of Top 10 SIP Mutual Funds

1. ICICI Prudential Infrastructure Fund

2. Motilal Oswal Midcap Fund

3. Bandhan Small Cap Fund

4. HDFC Mid Cap Fund

5. Franklin Build India Fund

6. ICICI Prudential Value Fund

7. Nippon India Growth Mid Cap Fund

8. HDFC Focused Fund

9. Motilal Oswal Large & Mid Cap Fund

10. HDFC Flexi Cap Fund

Conclusion

Frequently Asked Questions (FAQs)

What is SIP in Mutual Funds?

Are SIPs safe investments?

Can I stop or pause my SIP anytime?

Do SIPs give guaranteed returns?

How many SIPs should I have at one time?

Best Gilt Mutual Funds in India: Returns, Risks & Top Picks

What Are Gilt Mutual Funds?

Best Gilt Mutual Funds to invest in India

Best Gilt Mutual Funds – An Overview

1. SBI Gilt Fund

Fund Details :

Fund Performance

2. ICICI Prudential Gilt Fund

Fund Details :

Fund Performance

3. HDFC Gilt Fund

Fund Details :

Fund Performance

4 . Nippon India Gilt Fund

Fund Details :

Fund Performance

5. Baroda BNP Paribas Gilt Fund

Fund Details :

Fund Performance

6. Tata Gilt Securities Fund

Fund Details :

Fund Performance

7. Axis Gilt Fund

Fund Details :

Fund Performance

7. UTI Gilt Fund

Fund Details :

Fund Performance

8. Quant Gilt Fund

Fund Details :

Fund Performance

10. PGIM India Gilt Fund

Fund Details :

Fund Details :

Risks Associated With Gilt Mutual Funds

Conclusion

Frequently Asked Questions (FAQs)

What is a gilt mutual fund?

Are gilt funds completely safe?

Can I lose money in gilt funds?

Who should consider investing in gilt funds?

Are gilt funds better than fixed deposits?

How Interest Rates Impact Mutual Funds in India

Understanding Interest Rates

RBI Tools That Shape Interest Rates

1. Repo Rate

2. Reverse Repo Rate

3. Cash Reserve Ratio (CRR)

Factors Affecting Interest Rates

1. Inflation Pressure

2. Pace of Economic Activity

3. Availability of Money With Banks

4. Government Spending and Borrowing

5. Global Market Influence

How Interest Rates Impact Mutual Funds

1. Impact on Debt Mutual Funds

2. Impact on Equity Mutual Funds

3. Impact on Hybrid Mutual Funds

Understanding the Link Between Interest Rates and Mutual Funds