Best Mutual Funds to Invest in 2025

So, how does one identify the Best Mutual Funds for 2025? Does such a thing even exist ?

To be honest, best Mutual Funds could be a thing if the investor has access to the right advice, and the will to act on it, and a myth, if not. See, there are no readymade “best” Mutual Fund schemes. Variables such as investor priorities, monetary liabilities, income levels, investment objectives, etc, need to be factored in to diagnose if a certain mutual fund plan can fit into an individual’s scheme of things.

Every investor is unique, and so are their objectives. Therefore, their priorities, monetary liabilities, income levels, objectives, etc., must be taken into account before opting for a Mutual Fund scheme. For instance, a 25-year-old looking to purchase a car can entertain the thought of chasing returns since he has time and age on his side. Consequently, he can invest in relatively ambitious schemes to achieve the targeted corpus much before the intended deadline. A homemaker, on the other hand, who just wants to keep safe the money she has saved over time, may not want to be that adventurous, and therefore would opt for a scheme that offers consistent returns whilst keeping her invested corpus intact.

Simply put, the best Mutual Funds schemes are those that are in alignment with the investor’s objectives, limitations and goals.

There are no "best" mutual fund schemes for the simple reason that each individual's needs are unique. A scheme that works well for one investor may not work well for another.

Consider a service class investor nearing retirement. In all likelihood, such an investor will prefer to invest in a scheme that promises to preserve his capital while providing him with much-needed returns. A younger professional, on the other hand, will have more time on his side, allowing him to be more adventurous in his investment strategy and pursue higher returns.

Prioritizing is the best way to start shortlisting mutual funds for investment. Among other things, one must gain clarity on their investment purpose, the amount they need to set aside for this purpose, and the duration for which they can stay invested. These variables must be communicated to the professional assisting the investor in shortlisting a mutual fund scheme so the latter can outline a compatible investment plan.

Investing in the best mutual funds online is quite an easy and hassle-free method. However, the investor needs to be KYC compliant to invest in mutual funds. One can invest in the best mutual funds through online platforms like PRODIGY Pro-

• Log into the PRODIGY Pro app.
• Select a mutual fund that best suits your risk profile and investment objective.
• Select the amount you are planning to invest in the fund and your mode of investment, i.e. via an SIP or in a lump sum.

Apart from this, one can also invest in the best mutual funds through an AMC or via a mutual fund distributor. For this, investors need to open an account with the AMC by furnishing the necessary details, such as their name, mobile number and identification documents (PAN & Aadhaar), bank details, etc.

There are multiple Benefits of Investing in ELSS Mutual Funds. Listed below are some of those-

Tax Saving

One of the primary benefits of investing in ELSS mutual funds is tax saving. ELSS schemes enjoy tax benefits listed under Section 80C of the Income Tax Act. As per the governing provisions, investors can claim a tax deduction of up to Rs 1,50,000 a year by investing in ELSS schemes, saving up to Rs 46,800 a year on taxes.

Better Post-Tax Returns

Long-term capital gains made from ELSS are tax-free up to a limit of Rs. 1,25,000. Also, gains made over and above this limit are taxed at 12.5% only. In short, lower tax rates and higher returns ensure the best-possible post-tax returns.

High Returns

Inherently, ELSS investments are vulnerable to market fluctuations. However, this vulnerability can be used to the investor's advantage if the investment is given enough time to grow in the market. Over time, ELSS funds benefit from compounding laws and produce higher returns.

Multiple Investment Modes

Investors can enter ELSS schemes in one go by making a one-time lump sum investment, or they can invest in portions through regular monthly contributions via an SIP plan. This "flexibility" is what makes ELSS schemes an investor favourite.

Although we have populated the section below with what could be termed the "best" Mutual Fund schemes for SIP investments, we urge all investors to note that there are no one-size-fits-all plans. Every investor's needs are unique, so the SIPs they invest in should be identified individually. Please reach out to identify and invest in plans that fit your scheme of things.

For our investors’ convenience, we have listed below Mutual Fund schemes that are being considered the “best” for Lumpsum Investment in the current scenario. We, however, would like to reiterate that there are no universally beneficial Mutual Funds for Lumpsum Investments, because each investor’s needs are different. Therefore, their investment options should be shortlisted accordingly. Please reach out to us to figure out schemes that will complement your needs.

Listed below are the Mutual Fund schemes that are being considered the best investment options in 2025. However, we would like to clarify that there are no Mutual Fund plans that can be termed the “best” in absolute terms, because every investor’s needs are different. As a result, the schemes they invest in should be shortlisted individually. Please get in touch with us to figure out schemes that suit you best.

Mentioned below are some plans that are being touted as the “best” Mutual Fund schemes for long-term investment. We, however, would like to make clear that there are no unanimously beneficial schemes. Investors should note that each individual’s needs are unique. Therefore, their investment options should be shortlisted individually. Please get in touch with our experts to figure out the schemes that match you best.

Mutual Funds are invested in various asset classes, due to which they are susceptible to market fluctuations. These market fluctuations can lead to potential losses; therefore, analyzing the risks associated with investing in mutual funds is necessary. Listed below are the risks that accompany mutual funds.

Market Risk

Market risk arises due to the underperformance of the market, which could lead to losses for mutual fund investors. Several reasons can be responsible for the poor performance, like a pandemic, global slowdown, inflation, and so on, making life difficult for investors.

Concentration Risk

Concentration basically means focusing on one thing, and so does concentration risk. When mutual fund schemes invest their entire accumulated corpus in one asset class, the risk factor is greater. The best way to avoid such threats is diversifying the portfolio. The more spread out the portfolio, the lesser at risk it shall be.

Interest Rate Risk

The fluctuation in a debt fund's NAV due to changes in interest rates is known as Interest Rate Risk. Whenever interest rates rise, debt funds experience an drop in their NAV, meaning the two are inversely related.

Liquidity Risk

Liquidity risk refers to the inability to redeem units from a mutual fund scheme. This usually happens when a seller is unable to find a buyer for the security or when the investment is made in an ELSS scheme that has a mandatory three-year lock-in period.

Credit Risk

When the issuer of a bond purchased is unable to pay the promised interest it is referred to as Credit Risk. Investors can evaluate credit risk by analyzing the credit ratings awarded to the scheme by credit rating agencies.

Many investors make the mistake of investing in Mutual Fund schemes based on previous returns. Investors should refrain from investing in table-topper funds, simply because the first-hand research required to identify suitable schemes goes beyond comparing previous returns.

It is worth noting that top mutual funds keep changing on a daily basis, across categories, depending upon market highs and lows. Meaning, the mutual fund presently topping the charts may not make top 10 the very next day or week. Therefore, investing in a scheme just because of its ranking is a flawed approach. Mutual Funds should only be shortlisted after thorough research, that too by someone who knows what he/she is doing.