Over the past few years, the India’s markets have seen an incredible boom, especially during and the years following the pandemic. Retail investors jumped in like never before, and this flood of participation resulted in pushing the benchmarks such as the NIFTY50 and SENSEX to record highs. What’s even more interesting is that several mutual funds didn’t just ride the wave they beat it. If you’re here to know which funds have quietly outperformed the indices over the past decade, you’re in the right place. As that is what we are going to do here, to start with-
What Exactly Is a Mutual Fund?
A mutual fund is basically a pool of money collected from many investors. This pool is then managed by a professional, known as a fund manager, who invests it across different financial assets—primarily stocks, but sometimes also in bonds or cash instruments. Depending on the fund type, you might even earn dividends along the way. From 2021 to 2024, small-cap and mid-cap stocks soared, leaving many large-cap names in the dust. Toward the end of 2024, though, there was a noticeable dip in small and mid-cap segments. But just as quickly, some of them bounced back in early 2025.
1) Nippon India Small Cap Fund: This fund has been a consistent performer in the small-cap space. It focuses on spotting early-stage companies with strong potential and backing them early. Even after the post-pandemic boom, the fund showed incredible resilience and continued its upward journey. If you have a long horizon and are comfortable with market swings, this fund is one of the most solid bets in its category.
- Started: 2010
- Assets Under Management(AUM): Rs 63,000 crore
- 10-Year CAGR: 24%
- Key Holdings: TREPS (4.4%), HDFC Bank (2.05%), Multi Commodity Exchange (1.94%)
- Sectors: Industrials (12.71%), Materials (12.47%), Financials (11.10%)
2) Quant Small Cap Fund: Quant Small Cap is different from others in the list, as this uses quant based research using data and algorithm to pick stocks. And using these high tech modules causes the portfolio to change rapidly signifying its apt for experienced investors who understand the working and risks that come with this fund, and you can expect high returns from this one.
- Started: 1996
- AUM: Rs 28,000 crore
- 10-Year CAGR: 20.7%
- Top Holdings: Reliance Industries (9.85%), TREPS (6.47%), Jio Financial Services (5.69%)
- Sectors: Energy (14.42%), Healthcare (13.16%), Materials (7.63%)
3) Motilal Oswal Midcap Fund: This fund is the only mid-cap fund on this list, and it deserves its spot. It focuses on high-quality mid-sized companies with strong management and growth visibility. If you’re planning to stay invested for at least 8 years and want a slightly more stable ride compared to small-cap funds, this is a strong contender.
- Started: November 2013
- AUM: Rs 27,000 crore
- 10-Year CAGR: 19.8%
- Top Constituents: CBLO (16.31%), Net Receivables/Payables (14.86%), Coforge Ltd. (10.12%)
- Main Sectors: Reverse Repo (16.31%), Net Receivables/Payables (14.86%), IT Services (11.93%)
4) HSBC Small Cap Fund: This is a more quality-focused approach. The fund manager picks fundamentally sound businesses with good governance and long-term potential. It suits investors looking for a disciplined small-cap strategy with a time horizon of at least 7 years.
- Started: 2014
- AUM: Rs17,000 crore
- 10-Year CAGR: 20.9%
- Major Holdings: TREPS (3.54%), Aditya Birla Real Estate (2.16%), Techno Electric & Engineering (2.12%)
- Sectors in Focus: Industrials (21.13%), Financials (15.24%), Consumer Discretionary (10.68%)
5) Axis Small Cap Fund: This fund stands out for its relatively low volatility—something rare in the small-cap universe. It is a good pick for conservative investors who still want small-cap exposure but without much volatility. A 10-year holding period is recommended to get the most out of this.
- Started: 2013
- AUM: Rs 22,700 crore
- 10-Year CAGR: 24%
- Investments Include: TREPS (11.6%), KIMSL (2.94%), Brigade Enterprises (2.69%)
- Sector Allocation: Financials (12.69%), TREPS/Reverse Repo (11.60%), Materials (8.97%)
Also read: Top Performing Debt Mutual Funds in June 2025: Do You Own Any?
Factors to Consider Before Investing in These Mutual Funds
- Investment Horizon: It is required to understand and realise how long you can commit your funds. As in a shorter time horizon an individual cannot take much risk but as the horizon increase the risk appetite also increases.
- Financial Goal: What are you expecting from your investments? This question is very important even before you start your investment journey. Once you realise it, you can choose the right financial instrument for yourself.
- Risk Appetite: The amount of risk you can take clearly tells how much your potential return on investment can be. High risk-taking ability equates to high returns.
- Returns: Calculate the return you are expecting on your investment, A ballpark of the same would be enough as it is important to expect right and practical for your investments, in order to gain well.
- Fees: Choosing the right broker is important. Some of them charge high fees, as they also provide equivalent research services and results as well. While if you are expecting a more pocket friendly ones those too are available. Therefore it is important to chose the right advisory according to your goals.
Wrapping It Up
Coming to the end of this analysis. We come to observe that most of the funds mentioned here are small-cap funds that have delivered great returns, along with consistency, adaptability, and strong management even during market turmoil. Additionally, it is important to keep in mind that high returns often come with high risk, especially in the case of small-cap and mid-cap funds. If you are planning to invest in any of the following, it is important to understand and make sure of your financial goals and time horizon, and align the with a chosen mutual fund before starting to invest in it.
Written by Adithya Menon
