Highest Return Mutual Fund in Last 5 Years

When it comes to wealth creation through equities, time in the market matters more than trying to time the market. While short-term returns can be unpredictable, mutual fund returns in the last 5 years offer a clearer view of how funds have performed across different market cycles, including rallies, corrections, and periods of volatility.

In this guide, we cover the best performing mutual funds in last 5 years, their categories, approximate returns, and who they may be suitable for, helping beginners and long-term investors make informed decisions.

Best Performing Mutual Funds For Last 5 Years

The table below highlights some of the highest return mutual funds in last 5 years across small-cap, mid-cap, flexi-cap, and thematic categories. Returns are approximate and indicative.

Note: Data based on direct plan performance as of late 2025.

Returns shown are for direct plans and are indicative as of late 2025; verify latest fund fact sheets and SEBI risk‑o‑meter ratings before investing.

What Does CAGR Mean?

CAGR (Compound Annual Growth Rate) shows the average yearly return of a fund over a period. It does not mean the fund delivered the same return every year. Some years may have seen sharp gains, while others may have experienced losses. CAGR simply smooths the journey into one number.

Disclaimer: The mutual fund information and returns mentioned here are for educational and informational purposes only and are based on publicly available data. Past performance is not indicative of future results. Mutual fund investments are subject to market risks; please read all scheme-related documents carefully before investing. Investors are advised to consult a qualified financial advisor to assess suitability based on their financial goals and risk profile.

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Overview of Highest Return Mutual Funds in the Last 5 Years

Below is a brief overview of each fund, including its investment approach and key details.

1. Quant Small Cap Fund:

Quant Small Cap Fund focuses on emerging companies with high growth potential. The fund follows a dynamic and data-driven strategy, making it one of the best-performing mutual funds for last 5 years in the small-cap segment.

Best for: Aggressive investors with a 7–10 year horizon

Pro Tip: SIPs are preferred over a lump sum due to high volatility

• NAV: ₹275
• Rating: 4
• Minimum SIP Amount: ₹1,000
• Fund Size: ₹30,169 Cr
• Expense Ratio: 0.75%

2. Nippon India Small Cap Fund:

This fund invests in a diversified portfolio of small-cap stocks across sectors. Its disciplined stock selection process has helped it deliver strong mutual fund returns in last 5 years, despite higher volatility.

Best for: Long-term investors comfortable with fluctuations

• NAV: ₹187
• Rating: 4
• Minimum SIP Amount: ₹100
• Fund Size: ₹68,571 Cr
• Expense Ratio: 0.63%

3. HDFC Mid Cap Opportunities Fund:

HDFC Mid Cap Opportunities Fund aims for long-term capital appreciation by investing in quality mid-sized companies. It is often considered a stable option among the best-performing mutual funds in the mid-cap category over the last 5 years.

Best for: Investors seeking balanced growth with moderate volatility

• NAV: ₹225.49
• Rating: 5
• Minimum SIP Amount: ₹100
• Fund Size: ₹92,168 Cr
• Expense Ratio: 0.71%

4. Motilal Oswal Midcap Fund:

This fund follows a concentrated portfolio strategy, focusing on high-conviction mid-cap stocks. Its approach has helped it emerge as the highest return mutual fund in 5 years within its category.

Best for: Investors comfortable with short-term underperformance

• NAV: ₹116.49
• Rating: 5
• Minimum SIP Amount: ₹500
• Fund Size: ₹38,002.68 Cr
• Expense Ratio: 0.73%

5. HDFC Flexi Cap Fund:

HDFC Flexi Cap Fund invests across large-cap, mid-cap, and small-cap stocks, offering flexibility across market cycles. Its diversified strategy has contributed to strong best mutual fund returns over the last 5 years.

Best for: Core portfolio allocation for long-term investors

• NAV: ₹2,268.30
• Rating: 5
• Minimum SIP Amount: ₹100
• Fund Size: ₹94,068.73 Cr
• Expense Ratio: 0.65%

6. Parag Parikh Flexi Cap Fund:

Known for its value-oriented and global investing approach, this fund invests in Indian equities along with select international stocks. It is widely regarded as a consistently highest return mutual fund in last 5 years with a long-term focus.

Best for: Conservative equity investors seeking global exposure

• NAV: ₹94.95
• Rating: 5
• Minimum SIP Amount: ₹1,000
• Fund Size: ₹1,25,799.63 Cr
• Expense Ratio: 0.63%

7. ICICI Pru Infrastructure Fund:

This thematic fund focuses on infrastructure-related sectors such as power, construction, and logistics. With India’s infrastructure push, it has delivered some of the best-performing mutual funds in the last 5 years, among thematic funds.

Best for: Tactical investors with sectoral conviction

• NAV: ₹212.93
• Rating: 5
• Minimum SIP Amount: ₹100
• Fund Size: ₹8,160.47 Cr
• Expense Ratio: 1.15%

Checklist: Things to Consider Before Investing

Before selecting any mutual fund, especially those with high past returns, keep these key factors in mind:

• Risk Capacity: Ask yourself whether you can handle a temporary 30% decline in your portfolio without panic-selling. High-return funds often come with higher volatility.
• Time Horizon: Small-cap and mid-cap funds are best suited for long-term goals. A minimum investment horizon of 5–7 years or more helps ride out market ups and downs.
• Direct vs Regular Plans: Direct plans have lower expense ratios since there are no distributor commissions, which can significantly improve long-term returns.
• Exit Load: Most equity mutual funds charge an exit load of around 1% if you redeem your investment within one year. Always check this before investing.
• Taxation:

Equity LTCG: Long-term capital gains above ₹1.25 lakh (for holdings over 12 months) are taxed at 12.5% as per current tax rules.

STCG: Short-term capital gains (units sold within 12 months) are taxed at 20% under FY 2024–25 regulations.

• Portfolio Overlap: Avoid investing in multiple funds from the same category, as they often hold similar stocks, reducing the benefits of diversification.

Conclusion

The funds discussed above have proven themselves to be the best-performing mutual funds over the last 5 years, generating strong long-term returns across market cycles. However, the mutual fund offering higher returns may not always align with your personal goals or risk tolerance.

Successful investing is about discipline, diversification, and patience, not chasing past returns. Always align fund selection with your financial objectives, and when in doubt, seek professional advice for sustainable wealth creation.