Best performing mutual funds in January 2023
January 2023 was again a month of negative returns on the key indices. The Nifty was down -2.45% in January 2023, Mid Cap index down -2.64% and the Small Cap index was down -2.36%. The fall in the markets was an outcome of too much hawkishness by the central banks as well as persistent selling by the foreign portfolio investors (FPIs). In January 2023 alone, FPIs sold equities worth $3.52 billion, adding to the pressure on the stock markets.
While equity funds saw tapering of short term performance, the debt funds also came under pressure. Amidst the vagaries in interest rate signals, the bond yields were locked in a slightly higher range of 7.3% to 7.4%. This again impacted short term returns on the bond funds. The pressure on bond yields came from hawkish tone of the Fed and the RBI. Here is how mutual funds across 12 key categories performed in January 2023.
Table of Content
- Best performing mutual funds in January 2023
- Equity Large-Cap Funds
- Equity Multi-Cap Funds
- Equity Mid-Cap Funds
- Equity Small-Cap Funds
- Equity Linked Savings Schemes (Tax Saving)
- Balanced Funds (Aggressive Allocation)
- Balanced Funds (Conservative Allocation)
- Arbitrage Funds (Cash-Futures)
- Government Securities Funds (Gilt Funds)
- Corporate Bond Funds
- Credit Risk Funds
- Liquid Funds
Equity Large-Cap Funds
Top performing Direct Plans (Growth Option) on 5-year returns (as on 31st Jan-23):
Name of Fund | 1-Year Return | 3-Year Return | 5-Year Return |
| Canara Robeco Blue-Chip (G) | 0.480% | 15.973% | 13.498% |
| Axis Blue-Chip Fund (G) | -5.580% | 10.469% | 11.708% |
| Kotak Bluechip Fund (G) | 2.513% | 15.728% | 11.501% |
| Category Average | 0.580% | 13.450% | 9.485% |
| BSE 100 (TR) Index | 3.266% | 15.618% | 10.903% |
| Data Source: Morningstar | |||
Equity Multi-Cap Funds
Top performing Direct Plans (Growth Option) on 5-year returns (as on 31st Jan-23):
Name of Fund | 1-Year Return | 3-Year Return | 5-Year Return |
| Quant Active Fund (G) | 5.591% | 34.030% | 20.418% |
| Mahindra Manulife Multi (G) | -1.544% | 21.384% | 14.553% |
| Baroda BNP Multi Cap (G) | -0.490% | 19.851% | 11.531% |
| Category Average | 2.396% | 18.552% | 12.045% |
| BSE 500 (TR) Index | 1.656% | 16.472% | 10.545% |
| Data Source: Morningstar | |||
Equity Mid-Cap Funds
Top performing Direct Plans (Growth Option) on 5-year returns (as on 31st Jan-23):
Name of Fund | 1-Year Return | 3-Year Return | 5-Year Return |
| Quant Mid-Cap Fund (G) | 12.907% | 34.303% | 20.128% |
| PGIM India Mid-Cap Fund (G) | -0.849% | 32.037% | 18.044% |
| Axis Mid-Cap Fund (G) | -3.231% | 17.569% | 15.698% |
| Category Average | 1.776% | 19.938% | 11.529% |
| BSE Midcap (TR) Index | 1.414% | 18.194% | 8.444% |
| Data Source: Morningstar | |||
Equity Small-Cap Funds
Top performing Direct Plans (Growth Option) on 5-year returns (as on 31st Jan-23):
Name of Fund | 1-Year Return | 3-Year Return | 5-Year Return |
| Quant Small Cap Fund (G) | 6.653% | 49.657% | 24.210% |
| Axis Small Cap Fund (G) | 3.538% | 23.980% | 19.235% |
| Kotak Small Cap Fund (G) | -0.559% | 28.121% | 16.060% |
| Category Average | 1.565% | 27.141% | 12.582% |
| BSE Midcap (TR) Index | -2.693% | 25.482% | 9.536% |
| Data Source: Morningstar | |||
Equity Linked Savings Schemes (Tax Saving)
Top performing Direct Plans (Growth Option) on 5-year returns (as on 31st Jan-23):
Name of Fund | 1-Year Return | 3-Year Return | 5-Year Return |
| Quant Tax Plan (G) | 6.603% | 37.537% | 21.540% |
| Canara Robeco Tax Saver (G) | -0.900% | 19.114% | 14.486% |
| Mirae Asset Tax Saver (G) | 0.006% | 18.766% | 13.762% |
| Category Average | 0.167% | 14.879% | 9.340% |
| BSE 200 (TR) Index | 2.267% | 16.069% | 10.923% |
| Data Source: Morningstar | |||
Balanced Funds (Aggressive Allocation)
Top performing Direct Plans (Growth Option) on 5-year returns (as on 31st Jan-23):
Name of Fund | 1-Year Return | 3-Year Return | 5-Year Return |
| Quant Absolute Fund (G) | 10.529% | 29.379% | 18.261% |
| ICICI Pru Equity & Debt (G) | 7.475% | 20.848% | 13.500% |
| Baroda BNP Paribas AEH (G) | 3.148% | 14.087% | 12.619% |
| Category Average | 1.712% | 13.579% | 9.274% |
| CRISIL MIF Blended Index PR | 3.705% | 7.688% | 7.895% |
| Data Source: Morningstar | |||
Balanced Funds (Conservative Allocation)
Top performing Direct Plans (Growth Option) on 5-year returns (as on 31st Jan-23):
Name of Fund | 1-Year Return | 3-Year Return | 5-Year Return |
| Kotak Debt Hybrid (G) | 5.091% | 11.670% | 9.790% |
| Canara Robeco Hybrid (G) | 3.558% | 9.464% | 9.073% |
| ICICI Pru Regular Savings (G) | 4.855% | 9.250% | 8.785% |
| Category Average | 4.885% | 8.216% | 6.473% |
| CRISIL MIP Blended Index PR | 3.705% | 7.688% | 7.895% |
| Data Source: Morningstar | |||
Arbitrage Funds (Cash-Futures)
Top performing Direct Plans (Growth Option) on 5-year returns (as on 31st Jan-23):
Name of Fund | 1-Year Return | 3-Year Return | 5-Year Return |
| Edelweiss Arbitrage (G) | 5.125% | 4.923% | 5.686% |
| Nippon Arbitrage Fund (G) | 4.942% | 4.793% | 5.684% |
| Invesco Arbitrage Fund (G) | 5.806% | 4.967% | 5.578% |
| Category Average | 4.299% | 4.019% | 4.874% |
| Benchmark Comparison | N.A. | N.A. | N.A. |
| Data Source: Morningstar | |||
Government Securities Funds (Gilt Funds)
Top performing Direct Plans (Growth Option) on 5-year returns (as on 31st Jan-23):
Name of Fund | 1-Year Return | 3-Year Return | 5-Year Return |
| DSP G-Sec Fund (G) | 3.675% | 6.743% | 8.506% |
| IDFC G-Sec Fund (G) | 2.588% | 6.323% | 8.417% |
| ICICI Pru G-Sec Fund (G) | 5.507% | 7.160% | 8.226% |
| Category Average | 3.825% | 5.606% | 7.133% |
| I-SEC MIBEX Index TR | 3.217% | 5.997% | 7.409% |
| Data Source: Morningstar | |||
Corporate Bond Funds
Top performing Direct Plans (Growth Option) on 5-year returns (as on 31st Jan-23):
Name of Fund | 1-Year Return | 3-Year Return | 5-Year Return |
| HSBC Corporate Bond (G) | 3.439% | 6.347% | 7.664% |
| ABSL Corporate Bond (G) | 4.485% | 6.662% | 7.449% |
| ICICI Pru Corporate Bond (G) | 5.210% | 6.515% | 7.363% |
| Category Average | 3.558% | 5.731% | 6.230% |
| CRISIL ST Bond Fund Index PR | 3.951% | 5.931% | 6.951% |
| Data Source: Morningstar | |||
Credit Risk Funds
Top performing Direct Plans (Growth Option) on 5-year returns (as on 31st Jan-23):
Name of Fund | 1-Year Return | 3-Year Return | 5-Year Return |
| ICICI Pru Credit Risk Fund (G) | 5.640% | 7.494% | 8.175% |
| HDFC Credit Risk Fund (G) | 4.651% | 7.592% | 7.717% |
| Baroda Credit Risk Fund (G) | 5.400% | 9.130% | 7.552% |
| Category Average | 12.913% | 6.164% | 4.523% |
| CRISIL ST Bond Fund Index PR | 3.951% | 5.931% | 6.951% |
| Data Source: Morningstar | |||
Liquid Funds
Top performing Direct Plans (Growth Option) on 5-year returns (as on 31st Jan-23):
Name of Fund | 1-Year Return | 3-Year Return | 5-Year Return |
| Quant Liquid Plan (G) | 5.214% | 4.884% | 5.881% |
| IDBI Liquid Fund (G) | 5.175% | 4.338% | 5.430% |
| Mahindra Manulife Liquid (G) | 5.236% | 4.297% | 5.420% |
| Category Average | 4.492% | 3.698% | 4.832% |
| CRISIL Liquid Fund Index PR | 5.324% | 4.461% | 5.540% |
| Data Source: Morningstar | |||
What are the broad inferences that follow from the above analysis of 12 categories of mutual funds in India for January 2023? Here are some key takeaways.
- Equity funds have seen diminution of returns in January 2023 due to higher volatility and a sharp sell-off by the foreign investors. That is very apparent in the 1-year returns, although the impact is much lower in 3-year returns and 5-year returns.
- In the case of debt funds, the impact has been largely neutral since the hawkishness in the central bank policy has been largely factored into bond yields. With benchmark bond yields in the range of 7.3% to 7.4% through the month, returns were in a range.
- In most of the categories, top performers have outshone the benchmark indices by a margin across longer time frames. It has been volatile in the short term. Most category leaders have done substantially better than the median returns of the category.
- The biggest takeaway from the above rankings is the consistency of leadership. For instance, more than 90% of the top rankers across the various fund categories have been common through the last 3 months of rolling five year returns.
- That broadly indicates consistency in performance by the top performers and makes them a lot more predictable from an investment perspective. The rankings are a solid basis for financial advisors and investors to use past returns to extrapolate the future.
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