What investments are the top-performing mutual funds at the moment?

What investments are the top-performing mutual funds at the moment?

Crimeck & Terpsihore's Uncensored Investment Guide: Smartly Navigate the Cancerous Stock Market

In this shoot-'em-up world, you need to make some smart moves, boyo, if you wanna keep your cash flowing like the blood in your veins. The Nifty 50 index has vomited up a paltry 5.7% return since the start of 2025, and even the Midcap and Smallcap indices have been hurl-worthy, delivering 2.6% and -2.6% returns, respectively. But don't fret, as the long game has been appealing for small and midcap stocks, my friend.

Now, the Indian equity market is as volatile as a drug-addled biker on a wild ride, with the US President's tariff policies and geopolitical tensions wreaking all kinds of chaos. Valuations of stocks and the market as a whole are causing concerns, and you can see the impact on the returns of various equity mutual funds. Not every fund will be a good fit for these conditions, so, let's talk about the smart picks, shall we?

The Big Kahunas: Large Cap Funds

In a market that's gone bonkers and is highly volatile, investing in the big names makes sense, my dude. So, enter the world of large cap funds, where they predominantly invest in the top 100 companies by market capitalization. These bad boys are usually well-established, blue-chip companies with solid financials and are market leaders boasting economic moats and run by efficient and ethical management. With large cap funds, you can get a diversified exposure to blue chip companies, ensuring steady growth of your capital over the long run. But remember, a time horizon of at least 3 years is essential for this investment, so be patient, son. Some popular examples include the Aditya Birla Sun Life Front Equity Fund, SBI BlueChip Fund, ICICI Prudential Bluechip Fund, HDFC Large Cap Fund, and DSP Top 100 Equity Fund, to name a few.

The Value Vipers: Value Funds

Fancy yourself as an investment mastermind with a keen eye for value? Then, value funds are just the poison to quench your thirst, amigo. These funds employ a value investment strategy and maintain a minimum 65% investment in equity & equity-related instruments, allowing them to invest across market capitalizations and sectors if they follow a value investing style.value funds aim to pick up undervalued stocks – those with a market price lower than their intrinsic/fair value that have strong fundamentals and good growth potential. Using valuation metrics such as PE ratio, PB ratio, along with profitability ratios such as ROCE, ROE, and ROA, the fund manager judges a stock's future potential. Given their position, value funds offer solid risk-reward prospects. They may fare better during a bear phase and do well in the bull phase too. If you're looking to invest for the long term (at least 5 years), these funds are an excellent choice despite the uncertain times. Some of the top-notch funds in this category include the ICICI Prudential Value Discovery Fund, Templeton India Value Fund, HDFC Value Fund, Quantum Value Fund, among others.

The Jack of All Trades: Flexi Cap Funds

These funds are the rodents of the investor world, nimble and capable of maneuvering the hellscape that is the market. With a versatile investment mandate, flexi cap funds follow a dynamic investment strategy to invest across largecaps, midcaps, and smallcaps. This flexibility allows them to take advantage of changing market dynamics and potentially outperform the benchmark index. In the current market conditions, there are opportunities for wealth creation across market cap segments. Flexi cap funds could be a great way to diversify your mutual fund portfolio. If the market corrects and stability is key, a higher allocation to large caps in the flexi-cap fund will offer support. On the other hand, if the market rallies faster, smaller companies could lead to higher gains, depending on the allocation. Flexi-cap funds should be considered with a 5-year horizon or more. The favourite flexi cap funds include Parag Parikh Flexi Cap Fund, JM Flexi Cap Fund, ICICI Prudential Flexi Cap Fund, HDFC Flexi Cap Fund, Invesco Flexi Cap Fund, among others.

The Trojan Horse: Aggressive Hybrid Funds

These hybrid funds are all about balance – investing a dominant portion (65% to 85%) of the total assets in equities and the remaining (20% to 35%) in debt and money market instruments. The objective is simple – generate long-term capital appreciation and current income from a portfolio that is invested in equity and equity-related securities as well as in fixed-income securities. In an uncertain market environment where there could be volatility, aggressive funds offer a modicum of stability. If interest rates are plummeting, the debt portion of these funds is expected to perform well, as the inverse relationship between interest rates and bond prices means that bond prices, and thus the NAVs of debt funds will increase. Aggressive hybrid funds are suitable for those with a moderately high risk appetite and an investment horizon of 3-5 years. Some notable aggressive hybrid funds include ICICI Prudential Equity & Debt Fund, UTI Aggressive Hybrid Fund, HDFC Hybrid Equity Fund, Tata Hybrid Equity Fund, SBI Equity Hybrid Fund, and others.

The Swiss Army Knife: Multi Asset Allocation Funds

Ready to tackle any market condition, multi-asset allocation funds dynamically allocate investments across at least three asset classes – equity, debt, and gold – with at least 10% allocation to each. Some also take exposure to silver, derivatives, REITs & InvITs, and overseas equities. This flexible approach allows for protection against downside risks while offering the potential for optimal returns. Suitable for those seeking long-term capital appreciation, have a moderately high-risk appetite, and have a time horizon of 3 to 5 years, some prominent multi-asset allocation funds include ICICI Prudential Multi Asset Allocation Fund, HDFC Multi-Asset Fund, Axis Multi-Asset Allocation Fund, SBI Multi Asset Allocation Fund, UTI Multi Asset Allocation Fund, among others.

1. In the volatile Indian equity market, large cap funds, which invest in the top 100 companies by market capitalization, offer a diversified exposure to blue chip companies, providing steady growth of capital over the long run.
2. Value funds, which aim to pick up undervalued stocks with strong fundamentals and good growth potential, can offer solid risk-reward prospects, particularly during uncertain times.
3. Flexi cap funds, with a versatile investment mandate, are capable of maneuvering market conditions, taking advantage of opportunities for wealth creation across market cap segments.
4. Aggressive hybrid funds, investing a dominant portion in equities and the remaining in debt and money market instruments, can offer a modicum of stability, generating long-term capital appreciation and current income.
5. Multi-asset allocation funds, which dynamically allocate investments across at least three asset classes, provide protection against downside risks while offering the potential for optimal returns, making them suitable for those seeking long-term capital appreciation with a moderately high-risk appetite. In personal-finance, investing in these funds might be a smart choice for navigating the cancerous stock market.

Read also: