Focused mutual funds: Only 4 schemes delivered 15%+ SIP returns in 5 years; Invesco India topped at 18.33%

Only four Focused funds have delivered SIP returns of more than 15% over five years, with Invesco India Focused Fund leading at 18.33%. Mirae Asset Focused Fund was at the other end with a 7.92% return.

Focused funds are equity mutual fund schemes that invest in a concentrated portfolio of up to 30 stocks. Unlike diversified equity funds, which spread investments across a larger number of companies, focused funds allow fund managers to take higher-conviction positions in a limited set of stocks.

This can make the performance of individual holdings have a larger impact on overall fund returns. The data also shows that fund size and recent performance do not necessarily translate into higher five-year SIP returns.

Only four focused funds crossed 15%

Invesco India Focused Fund delivered the highest five-year SIP return at 18.33%, followed by ICICI Prudential Focused Equity Fund at 16.73%. HDFC Focused Fund and SBI Focused Fund were the other two schemes to cross the 15% mark.

HSBC Focused Fund came closest to the 15% mark at 14.97%, followed by Kotak Focused Fund at 14.89% and Motilal Oswal Focused Fund at 14.82%.

Quant Focused Fund delivered a 13.98% five-year SIP return, while Mahindra Manulife Focused Fund posted 13.65%. DSP Focused Fund and Bandhan Focused Fund returned 13.21% and 13.17%, respectively.

At the lower end, Mirae Asset Focused Fund delivered 7.92%, followed by Franklin India Focused Equity Fund at 9.01% and Axis Focused Fund at 9.15%.

The gap between the highest and lowest five-year SIP returns was therefore 10.41 percentage points.

India’s biggest focused fund isn’t the top performer

SBI Focused Fund is the largest scheme in the category by net assets, with ₹50,041 crore. However, its 15.27% five-year SIP return placed it fourth among the funds that crossed the 15% mark.

HDFC Focused Fund was the second-largest scheme, with ₹27,925 crore in net assets, and delivered a 16.18% five-year SIP return. ICICI Prudential Focused Equity Fund had ₹17,764 crore in assets and delivered 16.73%.

Invesco India Focused Fund, however, had net assets of ₹6,065 crore and topped the five-year SIP return chart with 18.33%.

The difference is also visible among other large focused funds. Franklin India Focused Equity Fund had ₹11,510 crore in net assets but delivered a 9.01% five-year SIP return. Axis Focused Fund had ₹11,315 crore in assets and delivered 9.15%.

Aditya Birla Sun Life Focused Fund, with ₹8,017 crore in assets, delivered 12.66%, while Nippon India Focused Fund, with ₹8,530 crore, returned 11.14%.

The data suggests that a larger asset base does not automatically translate into higher SIP returns.

Motilal Oswal leads 3-year returns but falls short over 5 years

The three-year SIP return ranking looks different from the five-year chart. Motilal Oswal Focused Fund was the top performer over three years, delivering 16.53%. However, its five-year SIP return was 14.82%, leaving it outside the four funds that crossed 15%.

SBI Focused Fund delivered 14.92% over three years, just below the 15% mark, but its five-year return rose to 15.27%. Invesco India Focused Fund, meanwhile, delivered 14.08% over three years but topped the five-year chart at 18.33%.

ICICI Prudential Focused Equity Fund also shows a notable difference between the two periods. Its three-year SIP return was 11.96%, compared with 16.73% over five years. HDFC Focused Fund delivered 9.82% over three years but 16.18% over five years.

ITI Focused Fund delivered 14.52% over three years but does not have a five-year return in the data because it does not yet have a full five-year track record.

Overall, the five-year SIP returns of focused funds varied from 7.92% to 18.33%. Only four schemes crossed 15%, while several large funds remained below 10%. The three-year data also shows that recent leaders can differ from longer-term performers.

For investors comparing focused funds, the data highlights why both the investment horizon and the fund’s historical performance need to be considered rather than relying on fund size or a single return period.