- Diversified portfolio
- Expert fund management
- Types of available schemes
- Ease of investments through SIPs
- Returns offered (Of course!)
In fact, compared to the mutual fund industry of the developed countries like the USA, Europe and other Asian countries, the mutual fund industry of India has shown the maximum growth.
It has grown from USD 92 billion to USD 317 billion at a CAGR of 17% from 2008 to the first quarter of 2019. Have a look –
Even now, in the post-COVID world, as the financial markets are regaining their lost lustre, mutual funds dominate in the investment segment as more and more investors divert their funds towards different types of mutual fund schemes.
The next year is around the corner, and, if you are looking for the best mutual funds to invest in 2022 look no further.
Here is a compilation of some of the best mutual funds to buy right now in 2022 for your investment needs under different categories –
1) Equity Mutual Funds
Let’s consider the equity mutual fund category first, which is the most popular category among investors. Equity mutual funds have a high-risk profile which they compensate with the potential of high returns.
Moreover, ELSS schemes provide tax benefits to investors and are, therefore, highly favoured.
So, let’s have a look at the different types of equity mutual funds and the best funds in each category –
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Large Cap Funds
Large cap funds are those that invest in the top 100 companies of the stock market.
These funds are better placed to weather out volatile markets as the underlying assets belong to established companies that can withstand a bearish phase.
The best performing mutual funds under this category are as follows –
| Name of the fund (all are Regular Growth funds) | 1-year return* | 3-year returns* |
| Axis Bluechip Fund | 14.80% | 13.87% |
| Kotak Bluechip Fund | 13.36% | 8.85% |
| ICICI Prudential Bluechip Fund | 11.78% | 7.10% |
| Canara Robeco Bluechip Equity Fund | 18.99% | 13.19% |
| SBI Bluechip Fund | 14.07% | 7.41% |
(Source: https://www.moneycontrol.com/mutual-funds/performance-tracker/returns/large-cap-fund.html)
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Mid-cap Funds
Mid-cap funds invest in companies ranked between 101 and 250 on the stock exchange. These funds have a higher risk profile compared to large cap funds and also provide higher returns.
The top performing equity mutual funds in this category are as follows –
| Name of the fund (all are Regular Growth funds) | 1-year return* | 3-year returns* |
| Axis Midcap Fund | 22.98% | 13.26% |
| Kotak Emerging Equity Scheme | 22.56% | 6.55% |
| DSP Midcap Fund | 25.55% | 7.87% |
| PGIM India Midcap Opportunities Fund | 48.46% | 9.58% |
| Invesco India Midcap Fund | 23.35% | 7.55% |
(Source: https://www.moneycontrol.com/mutual-funds/performance-tracker/returns/mid-cap-fund.html)
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Small Cap Funds
Small cap funds invest in stocks of companies which are in their growth phase. These companies have a high potential of growth and so promise a high return generating potential.
On the other hand, there is a high risk of capital erosion in volatile markets since small cap stocks face maximum erosion when the markets fall.
So, these funds are considered the best mutual funds to invest in for long term for investors having a high-risk appetite.
The top small cap mutual funds to invest in 2022 are as follows –
| Name of the fund (all are Regular Growth funds) | 1-year return* | 3-year returns* |
| Kotak Small cap Fund | 33.84% | 6.36% |
| Nippon India Small Cap Fund | 28.32% | 2.50% |
| Axis Small Cap Fund | 22.53% | 10.80% |
| DSP Small Cap Fund | 36.53% | 2.28% |
| ICICI Prudential Small Cap Fund | 21.96% | 1.94% |
(Source: https://www.moneycontrol.com/mutual-funds/performance-tracker/returns/small-cap-fund.html)
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Multi-cap Funds
Multi-cap funds are schemes which combine large cap, mid-cap and small cap stocks in their portfolio for diversified holdings.
The asset allocation to each type of stock is a minimum of 25% and then the fund manager is given the choice to allocate assets as per the market dynamics.
The best mutual funds to buy right now in 2022 under the multi-cap category is as follows –
| Name of the fund (all are Regular Growth funds) | 1-year return* | 3-year returns* |
| Parag Parikh Long Term Equity Fund | 31.19% | 14.46% |
| PGIM India Diversified Equity Fund | 24.57% | 11.54% |
| UTI Equity Fund | 26.62% | 14.35% |
| Canara Robeco Equity Diversified Fund | 11.15% | 11.36% |
| DSP Equity Fund | 17.53% | 9.93% |
(Source: https://www.moneycontrol.com/mutual-funds/performance-tracker/returns/multi-cap-fund.html)
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ELSS Schemes
Equity Linked Saving Schemes are tax-saving mutual fund schemes that allow a deduction on your investments under Section 80C up to a maximum of Rs.1.5 lakhs. The scheme has a lock-in period of 3 years and offers good returns on investment.
Here’s a complete guide on taxation in mutual funds
The leading ELSS schemes for 2022 are as follows –
| Name of the fund (all are Regular Growth funds) | 1-year return* | 3-year returns* |
| Axis Long Term Equity Fund | 17.15% | 11.99% |
| Canara Robeco Equity Tax Saver Fund | 23.46% | 12.78% |
| Mirae Asset Tax Saver Fund | 19.50% | 11.06% |
| Quant Tax Plan | 40.02% | 12.85% |
| Invesco India Tax Plan | 15.22% | 8.37% |
(Source: https://www.moneycontrol.com/mutual-funds/performance-tracker/returns/elss.html)