Best Mutual Funds to Invest With ₹1,000

For investors with a budget of ₹1,000, there are many mutual funds available to start a SIP, whether you're just beginning your investment journey or looking to diversify your portfolio with manageable amounts. 

With the power of compounding, investing small sums regularly can help you accumulate a substantial one-crore corpus over the course of 20-30 years.

In this blog, we’ve curated a list of the best mutual funds to invest in with ₹1,000, based on their 3-year annualised returns.

Top Mutual Funds To Invest With ₹1,000

Given below is a list of some of the the best-performing mutual funds to invest in with ₹1,000 based on their 3-year annualised returns

Note - Data as of 25 March, 2025

Overview of Best Mutual Funds To Invest With ₹1,000

ICICI Prudential BHARAT 22 FOF Direct Growth

• 3-Y annualised returns: 29.25%
• AUM: ₹1,982.52Cr
• Expense Ratio: 0.12%
• Asset Allocation
• Equity: 99.3%
• Cash: 0.7%

Canara Robeco Infrastructure Direct Growth

• 3-Y annualised returns: 27.83%
• AUM: ₹726.15Cr
• Expense Ratio: 1.04%
• Asset Allocation
• Equity: 96.9%
• Cash: 3.1%

Bank of India Small Cap Fund Direct Growth

• 3-Y annualised returns: 20.33%
• AUM: ₹1,389.85Cr
• Expense Ratio: 0.54%
• Asset Allocation
• Equity: 94.7%
• Cash: 5.1%
• Debt: 0.2%

Bank of India Flexi Cap Fund Direct Growth

• 3-Y annualised returns: 20.88%
• AUM: ₹1,786.77Cr
• Expense Ratio: 0.51%
• Asset Allocation
• Equity: 97.3%
• Cash: 2.4%
• Debt: 0.3%

Parag Parikh ELSS Tax Saver Fund Direct Growth

• 3-Y annualised returns: 19.05%
• AUM: ₹4,477.32Cr
• Expense Ratio: 0.63%
• Asset Allocation
• Equity: 81.1%
• Cash: 20.0%
• Debt: -1.1%

Factors To Consider before starting an SIP of  ₹1,000

Below are some of the factors you should consider before starting an SIP of  ₹1,000 -

• Risk Appetite

Mutual fund investments are subject to market risks. That’s why it's important to match the risk profile of a mutual fund with your risk appetite. For instance, equity mutual funds tend to be more riskier but offer higher returns, while debt funds are relatively safer and offer moderate returns. 

• Investment Goal and Horizon

Before investing, you need to define your goals and then choose a mutual fund that aligns with your financial objective accordingly, whether you are saving for education, a house, retirement, or general wealth-building. 

• Past Performance

While past performance doesn't guarantee future results, analysing a fund's historical returns can give you an idea of how it has weathered market fluctuations and delivered returns over time.

• Expense Ratio 

The expense ratio can have a major impact on your mutual fund returns in the long run. Hence, ensure that you check the expense ratio of the mutual fund you are investing in. Generally an expense ratio between 0.5% and 0.75% is considered good . 

Conclusion 

Investing in mutual funds with a minimum of ₹1,000 is a great way to build wealth over time. However, before making any investment, carefully evaluate your financial goals, risk tolerance, and investment horizon. Mutual funds are long-term investments, so it's essential to stay committed and avoid knee-jerk reactions to short-term market volatility.

Mutual Funds Selection Criteria for Top Mutual Funds Listed Above

These mutual funds are listed based on the 3-year annualised returns. The selection is arranged in descending order. It is important to note that 3-year returns in no way guarantees a mutual fund’s performance. However, it can be used as a criterion for shortlisting mutual funds from within a category. Investors should recognise that other factors, such as financial health, management efficiency, and market trends, play crucial roles in determining the actual success of an investment. 

This mutual fund selection should not be construed as investment advice/recommendations/offer/solicitation of an offer to invest in any mutual funds by Groww Invest Tech Pvt. Ltd. (formerly known as Nextbillion Technology Pvt. Ltd.).