Top 3 Small-Cap Mutual Funds That Delivered Over 30% Returns in 5 Years

Small-cap mutual funds have garnered significant attention for their ability to generate high returns by investing in companies with strong growth potential. Despite market fluctuations, these funds have continued to attract investors looking to capitalise on emerging opportunities within the small-cap space.

According to the Association of Mutual Funds in India (AMFI), inflows into small-cap funds surged in January, demonstrating investors’ confidence in this segment. Small-cap funds recorded net inflows of ₹5,721 crore, up from ₹4,667.7 crore in December, despite broader market volatility.

Top-Performing Small-Cap Mutual Funds

Among various options in the market, three small-cap funds have consistently outperformed over the past 5 years, delivering annualised returns of more than 30%. 

Below is their performance:

Key Insights from the Performance Data

• Quant Small Cap Fund has emerged as the top performer, delivering a 39.74% annualised return over 5 years. An investment of ₹1,00,000 in this fund would have grown to approximately ₹5.34 lakh.
• Bank of India Small Cap Fund generated 30.43% annualised returns, with the same investment growing to ₹3.78 lakh.
• Nippon India Small Cap Fund followed closely with a 30.32% annualised return, turning ₹1,00,000 into ₹3.76 lakh.

While small-cap funds have historically delivered impressive returns, they also come with higher risks due to market volatility. Investors must carefully assess their risk appetite before considering allocations to this segment. Past performance does not guarantee future returns, and it is always advisable to conduct thorough research or consult a financial advisor before making investment decisions.

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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.