Top 10 Mutual Funds for Beginners to Invest in January 2025

Many new and relatively inexperienced investors are always looking for the best mutual funds to invest in. They ask their friends, colleagues or mutual fund forums about the best funds when they start investing or decide to invest additional money. However, most of them are not satisfied with the answers they get from the Internet or their friends for various reasons.

When you search online, you usually come across several websites with ready-made lists. In most cases, funds are shortlisted based on their short-term performance. Sometimes, a show in a single category may top the list because that category is currently trending.

Your friends or colleagues may tell you the names of programs they like or invest in. Again, there is no guarantee that the program is actually right for you.

Some people never stop collecting names of top funds because they always have doubts about the reliability of the names. It is no wonder that many investors continue to visit mutual fund forums for years after they start investing for validation.

For this reason, ETMutualFunds has decided to publish a list of top 10 mutual funds. We have selected two funds from five different categories of equity funds – Aggressive Hybrid Funds, Large Cap Funds, Mid Cap Funds, Small Cap Funds and Flexi Cap Funds. We believe this is good enough for a regular mutual fund investor. However, it has limitations. Read till the end and choose the fund that is best for you.

List of top 10 schemes:

• Canara Robeco Bluechip Equity Fund
• Mirae Asset Large Cap Fund
• Parag Parikh Flexi Cap Fund
• UTI Flexi Cap Fund
• Axis Midcap Fund
• Kotak Emerging Equity Fund
• Axis Small Cap Fund
• SBI Small Cap Fund
• SBI Equity Hybrid Fund
• Mirae Asset Hybrid Equity Fund

Here are some points to keep in mind while investing in these funds. First, find out about each category and see if it suits your investment objectives and risk profile.

Aggressive Hybrid Funds

For those new to equity mutual funds, aggressive hybrid schemes (formerly known as balanced schemes or equity-oriented hybrid schemes) are the best option. These plans make a combination of debt (20–35) and equity (65–80%). They are thought to be comparatively less volatile than pure equity schemes as a result of this mixed portfolio. For extremely conservative equities investors who want to build wealth over the long term with little volatility, aggressive hybrid schemes are the ideal investment vehicle.

Large Cap Funds

Some equity investors want a safe investment in equities. Large Cap schemes are for such people. These schemes invest in the top 100 stocks and are relatively safer than other pure equity funds. They also have relatively less volatility compared to mid and small cap schemes. This means that if you are looking for a relatively stable and modest return, you should invest in a large cap scheme.

Flexi Cap Funds

Regular equity investors (with moderate risk appetite) wanting to invest in the stock market need look no further than Flexi Cap Mutual Funds (or diversified equity funds). According to fund managers, these funds invest across market capitalizations and sectors. By investing in these funds, regular investors can benefit from the upward trend of any sector and stock category.

Small Cap and Mid Cap Funds

What about aggressive investors who want to take higher risks to earn more returns? Well, they can bet on mid cap and small cap schemes. Mid cap programs invest primarily in mid-sized companies while small cap funds invest in companies with smaller market capitalization. Though these programs may be volatile, they can also generate higher returns over the long term. If you have a long-term investment horizon and high risk tolerance, you can invest in these mutual fund categories.

Finally, searches beginning with the words “best” or “top” are unlikely to bring you the best solution. You should always choose a system that suits your investment objectives, investment horizon and risk profile. If you do not understand the basic concepts of mutual funds or are completely new to mutual funds and investing, you should always seek the help of a mutual fund advisor.