India's best performing mutual funds for December 2021

3 Jan 2022 , 09:26 AM

For the year 2021, the Nifty and the Sensex closed with nearly 22% gains making it the best year in terms of returns since 2017. In a way, year 2021 was the year of recovery as growth rates got back to pre-COVID levels and corporate results showed consistent improvement. This was despite challenges like higher input costs and a relapse of the pandemic.

Towards the end of the year, FPIs turned heavy sellers which resulted in the stock markets peaking in October and tapering gradually in the last 2 months. However, the returns for the full year were still extremely attractive at around 22%. That reflected in the performance of equity large and mid-cap funds on a yoy basis.

The 10-year benchmark bond yields spiked to a 20-month high of 6.50% towards the end of the year as pressure from Fed hawkishness, higher inflation and RBI variable rate reverse repos kept bond yields under pressure. This was reflected in the performance of the long duration debt funds.

1. Equity Large-Cap Funds

Top performing Regular Plans (Growth Option) on 5-year returns (as on 31st Dec-21):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
Axis Blue-Chip Fund (G)	20.641%	19.641%	20.290%
Canara Robeco Blue-Chip (G)	24.544%	21.031%	19.215%
Mirae Asset Large Cap (G)	27.736%	17.861%	17.654%
Data Source: Morningstar

2. Equity Multi-Cap Funds

Top performing Regular Plans (Growth Option) on 5-year returns (as on 31st Dec-21):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
Quant Active Fund (G)	55.644%	32.441%	25.958%
Principal Multi-Cap Fund (G)	46.280%	20.474%	18.890%
Baroda Multi Cap (G)	47.860%	24.381%	18.309%
Data Source: Morningstar

3. Equity Mid-Cap Funds

Top performing Regular Plans (Growth Option) on 5-year returns (as on 31st Dec-21):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
PGIM India Mid-Cap (G)	63.780%	36.028%	23.663%
Axis Mid-Cap Fund (G)	39.928%	25.210%	23.603%
Quant Mid-Cap Fund (G)	50.386%	27.658%	21.865%
Data Source: Morningstar

4. Equity Small-Cap Funds

Top performing Regular Plans (Growth Option) on 5-year returns (as on 31st Dec-21):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
SBI Small Cap Fund (G)	47.565%	27.894%	24.608%
Nippon India Small Cap (G)	74.338%	29.988%	24.424%
Axis Small Cap Fund (G)	58.223%	32.216%	23.825%
Data Source: Morningstar

5. Equity Linked Savings Schemes (Tax Saving)

Top performing Regular Plans (Growth Option) on 5-year returns (as on 31st Dec-21):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
Quant Tax Plan (G)	59.829%	34.219%	25.828%
BOI AXA Tax Advantage (G)	41.452%	28.602%	22.911%
Mirae Tax Saver Fund (G)	35.294%	23.325%	22.072%
Data Source: Morningstar

6. Balanced Funds (Aggressive Allocation)

Top performing Regular Plans (Growth Option) on 5-year returns (as on 31st Dec-21):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
Quant Absolute Fund (G)	44.476%	27.667%	20.447%
BOI AXA Mid and Small (G)	54.476%	24.525%	19.510%
Canara Robeco Hybrid (G)	22.761%	17.944%	15.776%
Data Source: Morningstar

7. Balanced Funds (Conservative Allocation)

Top performing Regular Plans (Growth Option) on 5-year returns (as on 31st Dec-21):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
ICICI Pru Regular (G)	9.899%	10.138%	9.651%
Kotak Debt Hybrid (G)	13.301%	12.766%	9.554%
Canara Robeco Hybrid (G)	9.983%	11.453%	9.257%
Data Source: Morningstar

8. Arbitrage Funds (Cash-Futures)

Top performing Regular Plans (Growth Option) on 5-year returns (as on 31st Dec-21):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
BNP Paribas Arbitrage (G)	3.672%	4.813%	5.373%
Nippon India Arbitrage (G)	3.838%	4.766%	5.303%
Kotak Arbitrage Fund (G)	3.957%	4.781%	5.298%
Data Source: Morningstar

9. Government Securities Funds (Gilt Funds)

Top performing Regular Plans (Growth Option) on 5-year returns (as on 31st Dec-21):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
IDFC G-Sec Fund (G)	2.054%	9.529%	7.871%
Edelweiss G-Sec Fund (G)	4.135%	9.427%	7.837%
ABSL G-Sec Fund (G)	3.553%	8.797%	7.532%
Data Source: Morningstar

10. Corporate Bond Funds

Top performing Regular Plans (Growth Option) on 5-year returns (as on 31st Dec-21):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
Birla Corporate Bond (G)	4.039%	8.459%	7.775%
HDFC Corporate Bond (G)	3.905%	8.625%	7.771%
Kotak Corporate Bond (G)	3.764%	7.643%	7.458%
Data Source: Morningstar

11. Credit Risk Funds

Top performing Regular Plans (Growth Option) on 5-year returns (as on 31st Dec-21):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
ICICI Pru Credit Risk Fund (G)	6.233%	8.488%	7.773%
HDFC Credit Risk Fund (G)	6.976%	8.834%	7.676%
Baroda Credit Risk Fund (G)	19.239%	7.620%	7.442%
Data Source: Morningstar

12. Liquid Funds

Top performing Regular Plans (Growth Option) on 5-year returns (as on 31st Dec-21):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
Quant Liquid Plan (G)	3.942%	5.323%	5.948%
IDBI Liquid Fund (G)	3.384%	4.833%	5.705%
Mahindra Manulife Liquid (G)	3.301%	4.763%	5.667%
Data Source: Morningstar

In December 2021 equity fund returns were negatively impacted across large caps and mid-caps. Markets sentiments were also negatively impacted by FPI selling, monetary hawkishness and valuation concerns. However, the leaders sustained their leadership and that is a sign of performance consistency.

Like Oct-21 and Nov-21, even Dec-21 saw tapering of monthly returns on longer duration funds, while liquid funds and floaters did better. The key triggers for bond funds in the coming months will be the impact of Fed taper, Fed rate hikes, wholesale inflation and the monetary policy trajectory of the RBI.