Best Performing Equity Mutual Funds For August 2026: HDFC MIdcap Fund, SBI PSU Fund, and More Based on 5-Year CAGR!

Equity mutual funds have long been a preferred investment option for individuals looking to build wealth over the long term. By investing in a diversified portfolio of stocks, these funds offer the potential to benefit from the growth of India's equity markets while reducing the impact of holding individual stocks.

When evaluating equity mutual funds, looking beyond short-term returns is important. Metrics such as the 5-year CAGR can provide a clearer picture of how a fund has performed across different market conditions, offering insights into its long-term track record. However, past performance is only one part of the evaluation.

Investors should also consider factors such as the fund's investment objective, portfolio composition, expense ratio, and risk profile before making a decision. In this article, we have listed some of the best performing equity mutual funds for August 2026 based on their 5-year CAGR, along with key details to help you compare these schemes.

Top Performing Equity Mutual Funds Ranked by 5Y CAGR

Note: The mutual funds listed here have been selected and sorted based on their 1-year returns. 

Overview of Top Performing Equity Mutual Funds for August 2026

Aditya Birla Sun Life PSU Equity Fund

This thematic scheme focuses on state-owned enterprises, holding 72.32% of its portfolio in Large Cap stocks and maintaining a heavy 32.21% concentration in Public Banks. Categorised as Very High Risk by SEBI, it is tailored for long-term thematic growth. It has generated a 1-year return of ~8.95% and levies a 1% exit load for redemptions made within 30 days.

SBI PSU Direct Plan

A thematic equity scheme managed by SBI Mutual Fund that targets Public Sector Undertakings to capitalize on government-backed enterprises. Classified as Very High Risk, it allocates 78.46% to Large Cap companies and 25.94% specifically to Public Banks. The fund has delivered a 1-year return of ~8.79% and applies a 0.50% exit load if redeemed within 30 days.

HDFC Mid Cap Fund

A flagship, well-established mid-cap fund focused on generating long-term capital appreciation by primarily investing in medium-sized, high-growth companies. It maintains a diversified equity portfolio designed to navigate market cycles effectively. The fund offers a 1-year return of ~7.2% and imposes a 1% exit load for redemptions or switches made within 365 days of unit allotment.

Invesco India Smallcap Fund

This equity scheme seeks long-term capital expansion by investing predominantly in emerging small-cap companies across key growth sectors like Healthcare, Industrials, Consumer Cyclicals, and Real Estate. It aims to catch businesses early in their growth curves. It features a 1-year return of ~11.8% with a 1% exit load on redemptions exceeding 10% of allotted units within 1 year.

Nippon India Growth Mid Cap Fund

A growth-oriented mid-cap scheme benchmarked against the S&P BSE Mid-Cap Index, designed to capture alpha through investments in established mid-sized market leaders. The portfolio focuses on strong underlying fundamentals and business scalability. It has recorded a 1-year return of ~8.11% and charges a 1% exit load if units are redeemed or switched out within 1 month.

Bandhan Small Cap Fund

A small-cap fund managed by Bandhan Mutual Fund that targets high-growth potential businesses in the small-cap domain, operating under a Very High risk profile. The fund aims to leverage structural growth opportunities in early-stage public companies. It reflects a 1-year return of ~7.9% alongside a 1% exit load for redemptions executed within 1 year from the allotment date.

Nippon India Small Cap Fund

One of India's largest small-cap mutual funds, heavily weighted toward capital goods, financial services, and niche industrial leaders. It leverages extensive research to build a highly diversified, high-growth equity portfolio. The scheme reports a 1-year return ranging from ~3.1% to 5.9% (depending on the Direct/Regular plan) and carries a 1% exit load for redemptions within 1 month.

Motilal Oswal Large and Mid Cap Fund

An open-ended equity scheme that blends stability and growth by allocating across both market leaders (Large Caps) and rapidly growing enterprises (Mid Caps), benchmarked to the NIFTY LargeMidcap 250 TRI. Key portfolio weights lie in Financials and Capital Goods. It delivers a 1-year return of ~3.15% to 6.0% and assesses a 1% exit load if redeemed within 365 days.

Quant Small Cap Fund

An active small-cap equity fund driven by Quant's proprietary dynamic VLRT (Valuation, Liquidity, Risk, Timing) investment framework. Its strategic sector exposures include Financial Services, Healthcare, and Utilities to maximize momentum and risk-adjusted growth. It shows a 1-year return between ~8.78% and 11.0% and applies a 1% exit load if redeemed within 1 year.

Conclusion

Past performance should not be the only factor when choosing an equity mutual fund. Investors should also consider the fund's investment objective, portfolio allocation, expense ratio, risk profile, and how well it aligns with their financial goals, risk appetite, and investment horizon. As equity mutual funds are subject to market risks, it is advisable to read the scheme-related documents carefully and, if needed, consult a financial advisor before making an investment decision. 

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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.

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

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