These Funds Excelled Even in a Falling Market, Delivering Up to 15% Returns
Best Mutual Funds For a Market Crash: Even as the Sensex and Nifty declined, these mutual funds delivered double-digit returns to investors. Before investing, familiarize yourself with the essential details regarding their risks and ratings.
Best Mutual Funds For a Market Crash: When the stock market experiences a downturn, most investors are primarily concerned with simply safeguarding their capital from potential losses. However, did you know that there are certain mutual funds that, during this slump, not only protected investors' money but also generated impressive double-digit returns (exceeding 10%)?
Over the past year—a period marked by significant volatility in the Indian stock market—a select group of equity mutual funds has managed to generate returns of up to 15.46%. In stark contrast, the Sensex has declined by approximately 8%, while the Nifty 50 has fallen by nearly 5%.
Why Did the Market Witness Such a Decline?
There is no single factor responsible for the pressure currently weighing on the stock market. The primary catalyst is the escalating geopolitical tension in the Middle East. Since India imports the majority of its crude oil requirements, the unrest in that region drove up oil prices and triggered widespread fear across the market. Furthermore, Foreign Portfolio Investors (FPIs) have been consistently withdrawing their capital from the Indian market. Driven by a strengthening US dollar, foreign investors deemed it prudent to allocate their funds to safer havens rather than to emerging markets like India. The high cost of crude oil also exacerbated inflationary pressures within the country, thereby eroding corporate profit margins and weakening the Indian Rupee.
Which Funds Performed Exceptionally Well During These Challenging Times?
To identify the funds that delivered outstanding performance even amidst this difficult phase, three rigorous criteria were applied: a 5-star rating from Value Research, a low expense ratio (reflecting fund management costs), and robust 1-year returns. A low expense ratio is particularly crucial because, during an economic downturn, every single penny counts; the lower the operational costs, the higher your net returns will be.
The 5 funds listed below have performed best against these parameters:
| Fund Name (Direct) | Value Research Rating | Expense Ratio | 1-Year Return | Total Assets (AUM) | Fund Age |
|---|---|---|---|---|---|
| WhiteOak Capital Mid Cap | 5-Star | 0.72% | 15.46% | ₹5,293 Crore | 3 Years 8 Months |
| ICICI Pru Retirement (Pure Equity) | 5-Star | 0.71% | 12.82% | ₹1,869 Crore | 7 Years 2 Months |
| Nippon India Growth Mid Cap | 5-Star | 0.81% | 11.30% | ₹45,820 Crore | 13 Years 4 Months |
| Edelweiss Mid Cap | 5-Star | 0.60% | 10.39% | ₹15,911 Crore | 13 Years 4 Months |
| Bandhan Small Cap | 5-Star | 0.80% | 9.00% | ₹25,346 Crore | 6 Years 2 Months |
Note: All of these funds carry a very high risk level.
What precautions should investors take?
One should not invest blindly based solely on returns from the past year. It is not guaranteed that a fund which performed well last year will continue to deliver similar results in the future. Market conditions and sector cycles are constantly changing. Mutual fund investments are subject to market risks. Therefore, before investing, always carefully evaluate the scheme's objectives, risk level, and your own specific requirements.
