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Best Long Duration Mutual Funds

Long Duration mutual funds refer to funds that have excellent potential and the ability to provide high returns. However, these funds are very volatile in nature and come with high risks. When you take such a Long Duration mutual fund, you will be required to actively and thoroughly review the performance of these funds from time to time. This will help you be aware of how your fund is doing in the market.

These Long Duration mutual funds typically provide great dividends to an investor. If you are someone who is willing to take a high risk in order to receive good returns, then you can choose such a fund.

Long Duration mutual funds buy shares of different companies and invest the investor's money into those shares based on certain criteria.

By equity, we mean ownership. So when an individual or an institution buys stocks or shares of a company which is basically a borrower, then the individual acquires ownership in the company based on the number of units of stock or shares bought by him/her. Equity mutual funds give returns based on the market conditions. Like debt funds, they do not provide a fixed return over a period of time, but the return is dependent on the performance of the company on a daily basis. Hence the market value of equity mutual funds changes on a daily basis.

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Top 10 Long Duration Mutual Funds

Fund NameCategoryRisk1Y ReturnsRatingFund Size(in Cr)
Bank of India Small Cap FundEquityVery High2.5%5₹291
Canara Robeco Small Cap FundEquityVery High16.0%5₹2,560
PGIM India Midcap Opportunities FundEquityVery High6.8%5₹5,119
Quant Tax Plan FundEquityVery High4.5%5₹1,359
Quant Infrastructure FundEquityVery High12.9%5₹573
Quant Mid Cap FundEquityVery High8.0%5₹511
Axis Small Cap FundEquityVery High7.3%5₹8,984
Parag Parikh Flexi Cap FundEquityVery High2.5%5₹22,647
PGIM India Flexi Cap FundEquityVery High-2.4%5₹4,236
Bank of India Tax Advantage FundEquityVery High-5.0%5₹570
View All

What is the difference between Long Duration Mutual Funds and Short Duration Mutual Funds?

The basic difference between debt mutual funds and equity mutual funds is the investment destination. Debt mutual funds invest a large proportion (at least 65%) of the total money collected from investors into fixed income securities like Corporate Bonds, Government Bonds, Bonds issued by banks, Treasury Bills, etc. You can read more about the types of debt funds available here. These funds are better suited to investors who do not want to participate in the market volatility as these instruments are uncorrelated with the stock market performance. Investors in debt oriented funds also seek regular and stable returns or want to achieve some financial goal like buying a house, or paying for their child's education at a certain point of time in the future. Such investments are generally made for short to medium term. Equity mutual funds are more suited to investors who are not risk averse and are looking for medium to long term investments. It enables the investors to benefit out of the volatile nature of market. Unlike debt funds, equity funds do not have a predefined maturity date and can be redeemed upon the request of the investor. Absence of lock-in period adds to the liquid nature of the fund. In India, mutual fund returns have outperformed returns generated by stock market indices. It also allows the investor to take advantage of the expertise and knowledge of the fund manager as most funds are actively managed. Depending upon your risk appetite, you may choose to invest in small cap, mid cap or large cap companies.

When should I invest in long duration mutual funds?

This is contextual. If you do not wish to invest directly in stocks (because you have better things to do or just don’t feel like it), you can choose equity mutual funds (defined below). If you would like to lower your tax outgo compared to a fixed or recurring deposit and if possible with better returns, you can choose debt mutual funds (defined below). The clearer you are about your need, the faster and confident you will be in taking decisions regarding mutual funds – well, this applies to anything in life!

Who issues long duration mutual funds?

Asset management companies (or AMCs or fund houses) create mutual funds. All AMCs will have to be approved by the government body, Securities and Exchange Board of India (SEBI). All mutual funds have to be whetted by SEBI before it is open for the public to invest.

What does investing in long duration mutual funds actually mean?

Suppose a mutual fund invests in ten stocks and total current market value of these stocks is 1.1 Crore. Out of this, the AMC deducts say, 0.1 Crore for operating the fund (this is known as the expense ratio). So the net value is 1 crore. Now the AMC will divide this 1 Crore into say, 10,000 parts. These parts are known as units. The cost of one unit is 1Cr/10,000 = Rs. 1000. This is known as the Net Asset Value (NAV) of the mutual fund. Suppose the AMC has set a minimum investment requirement of Rs. 500. Then if you pay Rs. 500, you will get 0.5 units of the fund. Remember that the cost of one unit is the cost when you made the purchase. Suppose after one year, the NAV has fallen to Rs. 700 per unit and you wish to exit the fund (also known as redemption), then you sell your 0.5 units back to the AMC and get 0.5 x Rs. 700 = Rs. 350 back. Yes, you invested Rs. 500 and got back Rs. 350 – a loss of 150 over a year. The point is, that you buy units at current NAV and sell units (fully or partially) at current NAV. This is what investing in mutual fund actually means.

Let's have a closer look

Now let us jump and check about these top 10 mutual fund schemes.

Bank of India Small Cap Fund Direct Growth

Fund Performance: The Bank of India Small Cap Fund belongs to the Equity category of BOI AXA Mutual Funds.

Minimum Investment Amount: The minimum amount required to invest in Bank of India Small Cap Fund via lump sum is ₹5,000 and via SIP is ₹1,000.

Min Investment Amt₹5,000
AUM₹291Cr
1Y Returns2.5%

Canara Robeco Small Cap Fund Direct Growth

Fund Performance: The Canara Robeco Small Cap Fund belongs to the Equity category of Canara Robeco Mutual Funds.

Minimum Investment Amount: The minimum amount required to invest in Canara Robeco Small Cap Fund via lump sum is ₹5,000 and via SIP is ₹1,000.

Min Investment Amt₹5,000
AUM₹2,560Cr
1Y Returns16.0%

PGIM India Midcap Opportunities Fund Direct Growth

Fund Performance: The PGIM India Midcap Opportunities Fund has given 32% annualized returns in the past three years and 17.3% in the last 5 years. The PGIM India Midcap Opportunities Fund belongs to the Equity category of PGIM India Mutual Funds.

Minimum Investment Amount: The minimum amount required to invest in PGIM India Midcap Opportunities Fund via lump sum is ₹5,000 and via SIP is ₹1,000.

Min Investment Amt₹5,000
AUM₹5,119Cr
1Y Returns6.8%

Quant Tax Plan Direct Growth

Fund Performance: The Quant Tax Plan Fund has given 31.31% annualized returns in the past three years and 20.36% in the last 5 years. The Quant Tax Plan Fund belongs to the Equity category of Quant Mutual Funds.

Minimum Investment Amount: The minimum amount required to invest in Quant Tax Plan Fund via lump sum is ₹500 and via SIP is ₹500.

Min Investment Amt₹500
AUM₹1,359Cr
1Y Returns4.5%

Quant Infrastructure Fund Direct Growth

Fund Performance: The Quant Infrastructure Fund has given 30.32% annualized returns in the past three years and 21.19% in the last 5 years. The Quant Infrastructure Fund belongs to the Equity category of Quant Mutual Funds.

Minimum Investment Amount: The minimum amount required to invest in Quant Infrastructure Fund via lump sum is ₹5,000 and via SIP is ₹1,000.

Min Investment Amt₹5,000
AUM₹573Cr
1Y Returns12.9%

Quant Mid Cap Fund Direct Growth

Fund Performance: The Quant Mid Cap Fund has given 30.28% annualized returns in the past three years and 18.63% in the last 5 years. The Quant Mid Cap Fund belongs to the Equity category of Quant Mutual Funds.

Minimum Investment Amount: The minimum amount required to invest in Quant Mid Cap Fund via lump sum is ₹5,000 and via SIP is ₹1,000.

Min Investment Amt₹5,000
AUM₹511Cr
1Y Returns8.0%

Axis Small Cap Fund Direct Growth

Fund Performance: The Axis Small Cap Fund has given 26.3% annualized returns in the past three years and 18.64% in the last 5 years. The Axis Small Cap Fund belongs to the Equity category of Axis Mutual Funds.

Minimum Investment Amount: The minimum amount required to invest in Axis Small Cap Fund via lump sum is ₹5,000 and via SIP is ₹500.

Min Investment Amt₹5,000
AUM₹8,984Cr
1Y Returns7.3%

Parag Parikh Flexi Cap Fund Direct Growth

Fund Performance: The Parag Parikh Flexi Cap Fund has given 21.55% annualized returns in the past three years and 17.37% in the last 5 years. The Parag Parikh Flexi Cap Fund belongs to the Equity category of PPFAS Mutual Funds.

Minimum Investment Amount: The minimum amount required to invest in Parag Parikh Flexi Cap Fund via lump sum is ₹1,000 and via SIP is ₹1,000.

Min Investment Amt₹1,000
AUM₹22,647Cr
1Y Returns2.5%

PGIM India Flexi Cap Fund Direct Growth

Fund Performance: The PGIM India Flexi Cap Fund has given 20.77% annualized returns in the past three years and 14.53% in the last 5 years. The PGIM India Flexi Cap Fund belongs to the Equity category of PGIM India Mutual Funds.

Minimum Investment Amount: The minimum amount required to invest in PGIM India Flexi Cap Fund via lump sum is ₹5,000 and via SIP is ₹1,000.

Min Investment Amt₹5,000
AUM₹4,236Cr
1Y Returns-2.4%

Bank of India Tax Advantage Direct Growth

Fund Performance: The Bank of India Tax Advantage Fund has given 20.59% annualized returns in the past three years and 14.56% in the last 5 years. The Bank of India Tax Advantage Fund belongs to the Equity category of BOI AXA Mutual Funds.

Minimum Investment Amount: The minimum amount required to invest in Bank of India Tax Advantage Fund via lump sum is ₹500 and via SIP is ₹500.

Min Investment Amt₹500
AUM₹570Cr
1Y Returns-5.0%

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