Small cap schemes topped the list. Around 11 small cap schemes offered 20-34% returns. The other schemes that offered more than 20% SIP returns in the five-year horizon include four mid cap schemes, a multi cap, ELSS, flexi cap, and contra fund.
For the analysis, we considered equity categories like large cap, mid cap, small cap, large & mid cap, focused fund, ELSS, multi cap, flexi cap, value, and contra fund. We calculated the XIRR returns for the investments made through SIP. Regular and growth option schemes were considered for the analysis. The XIRR returns for five years were calculated for the period starting from May 1, 2018 to May 1, 2023.
Note, these schemes are from different equity mutual fund categories. They have different risk-reward ratios. So, don’t focus on the returns and make investment decisions. For example, small cap schemes have a very high risk, but they also offer very high returns over a long period. Flexi cap schemes, on the other, are recommended to moderate investors because these schemes invest in diversified portfolios and they are relatively less risky. That’s why you should always choose a scheme based on your investment objectives and risk tolerance.
Another point to remember is that we are talking about past returns here. Sure, these schemes have offered over 20% SIP returns in five years, but some of them are also performing badly in the short term. You should not be unduly bothered about the short-term performance. You need to find out the reason for the poor performance. If it is cyclical, you should take it in your stride.
If you are looking for quarterly performance of your favourite mutual fund categories, see these stories:
How mid cap schemes fare in January-March 2023?
Small cap category lost 3.19% in the January-March quarter
Flexi cap mutual funds lost 4.02% in Jan-March; Parag Parikh Flexi Cap Fund offered positive returns
ELSS funds posted negative returns in Jan-March quarter; Quant Tax Plan lost 8.72%
Multi cap category lost 4.16% in Jan-March; Quant Active Fund lost 9.94%
Value fund category lost 3.38% in Jan-March quarter; Quant Value Fund lost 8.73%
If you are looking for schemes to invest, here are our recommendations:
Best small cap mutual funds to invest in 2023
Best mid cap mutual funds to invest in 2023
Best tax saving mutual funds or ELSS to invest in 2023
Best flexi cap mutual funds to invest in 2023
