Best Equity Mutual Funds in January 2026 Based on 5-Year CAGR

Several equity mutual funds have delivered strong long-term performance when evaluated on a 5-year compounded annual growth rate basis. Sector-focused and thematic funds form a majority of the top performers over this period.

While 1-year absolute returns differ across schemes, the 5-year CAGR highlights sustained performance through market cycles. The table below presents the best-performing equity mutual funds strictly based on 5-year CAGR.

Top Equity Mutual Funds in January 2026 Based on 5-Year CAGR

Note: Data as of January 8, 2026.

Performance Snapshot Of PSU-Oriented Funds

PSU-focused funds dominate the top end of the 5-year CAGR ranking. SBI PSU Fund leads the list with a 5-year CAGR of 30.29%, supported by a 1-year absolute return of 15.12.

Aditya Birla SL PSU Equity Fund follows closely with a 5-year CAGR of 29.92 and the lowest expense ratio among the group at 0.61. Invesco India PSU Equity Fund recorded a 5-year CAGR of 28.84 and the highest 1-year absolute return in the list at 15.31.

Risk-Adjusted Returns Comparison

Sharpe Ratios across the listed funds range from -0.33 to 0.71. Aditya Birla SL PSU Equity Fund recorded the highest Sharpe Ratio at 0.71, indicating relatively stronger risk-adjusted performance.

SBI PSU Fund and Invesco India PSU Equity Fund both recorded Sharpe Ratios of 0.7. Quant Small Cap Fund posted a negative Sharpe Ratio, reflecting higher volatility and weaker recent risk-adjusted returns.

Top Equity Mutual Funds in January 2026 Based on AUM

Note: Data as of January 8, 2026.

Read More: Best Long-Term Stocks in Jan 2026.

Conclusion

Based strictly on 5-year CAGR, these equity mutual funds stand out as top long-term performers. PSU-focused strategies dominate the list, while infrastructure and small-cap exposure also feature prominently.

Although long-term returns are closely grouped, short-term performance, risk-adjusted returns, and expense structures differ meaningfully across schemes. The table highlights how multiple metrics alongside CAGR shape overall fund profiles.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.

Investments in the securities market are subject to market risks, read all the related documents carefully before investing.