From the introduction of Unit Trust of India (UTI)—the country's first mutual fund—sixty years ago to the 1993 launch of the nation's first private sector MF, mutual funds have become the preferred investment vehicles for individual investors. Undoubtedly, among the most well-regulated financial assets are mutual funds.
The returns from MFs haven’t disappointed either. This article lists the top 6 mutual funds introduced in India since 1986. They have a strong history of dividend payments and are either hybrid or equity plans. Plans that include children's funds and insurance integrated into them (UTI ULIP, LIC MF ULIS, and UTI CCF—Savings Plan) are not included in the list.
What are the oldest mutual funds in India?
In the diverse world of investment, old mutual funds in India have established themselves as a cornerstone for both novice and seasoned investors. Among multiple options of investment available today, the old mutual funds in India hold a special place, offering a blend of trust and performance cultivated over decades.
Some of the oldest mutual funds in India include:
- Unit Trust of India (UTI)
- UTI Mastershare Fund
- UTI Flexi Cap Fund, and
- SBI Magnum Equity ESG Fund
We will read more about these funds in the next section.
Overview of the oldest surviving mutual funds in India
The oldest mutual funds in India have been instrumental in shaping the investment landscape, offering a variety of schemes ranging from equity to debt and hybrid funds. Old mutual funds in India have not only stood the test of time but have also adapted to market changes, ensuring relevance and sustained performance. With a legacy spanning several decades, these funds provide a testament to the resilience and growth potential of the Indian mutual fund industry.
High-return mutual fund categories for smart investing
| Equity Mutual Funds | Hybrid Mutual Funds | Debt Mutual Funds |
| Tax Saving Mutual Funds | NFO Mutual Funds | Multi Cap Mutual Funds |
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List of the oldest mutual funds in India
UTI Mastershare Fund
Established on October 15, 1986, UTI Mastershare was a closed-ended vehicle at inception, and it was the first equity-diversified fund in the Indian mutual fund sector. Later, in 2003, it was changed into an open-ended fund. The fund has a strong history of paying out rights issues, bonuses, and dividends. For now, it falls within the large-cap fund category.
SBI Magnum Equity ESG Fund
This MF was established on January 1, 1991. The equity-oriented fund, first introduced as Magnum Multiplier Scheme '90, was renamed Magnum Equity Fund upon its conversion to an open-ended fund in 1997. The fund house renamed it SBI Magnum Equity ESG Fund and altered its attributes during the 2018 re-categorisation procedure.
Aggressive Hybrid Fund LIC MF
Since its founding on January 1, 1991, the LIC MF Aggressive Hybrid Fund—formerly known as the LIC Balanced Fund—has been managed with a balanced mix of debt and equity. As of right now, it falls into the aggressive hybrid funds category.
UTI Flexi Cap Fund
The fund was first created as UTI Mastergain in 1991 and was established on May 18, 1992. It changed its name to UTI Equity in 2005. When the market regulator approved flexicap and multi-cap categories in 2021, the fund underwent another name change to UTI Flexi Cap Fund.
Canara Robeco Equity Hybrid Fund
Since its inception on February 1st, 1993, the Canara Robeco Equity Hybrid Fund, formerly known as GIC Balanced, has consistently outperformed other funds. It is currently included in the category of aggressive hybrid funds.
Tata Large & Mid Cap Fund
After being introduced as Ind Sagar on February 25, 1993, it was later changed to Tata Large & Mid Cap Fund. This MF invests roughly 35 percent of its total capital in large- and mid-cap equities under the present strategy.
How to invest in mutual funds in India?
Investing in mutual funds in India is a straightforward process that can significantly augment your financial portfolio. Here’s how you can start:
Assess your financial goals: Determine your investment objectives, risk tolerance, and investment horizon to choose the right mutual fund.
- Research and compare: Explore various mutual fund schemes listed on trustworthy platforms like the Bajaj Finserv Platform, which offers over 1000+ mutual funds to choose from.
- Complete KYC: Ensure your KYC (Know Your Customer) process is complete. This is a one-time process required for all financial transactions in India.
- Choose the right scheme: Based on your research, select a mutual fund that aligns with your investment goals.
- Invest via a trusted platform: Platforms like the Bajaj Finserv Mutual Fund Platform allow you to invest in mutual funds seamlessly, offering a wide range of schemes to cater to diverse investment needs.
The fundamentals of mutual funds
Mutual funds are an investment vehicle designed to pool money from multiple investors to purchase a diversified portfolio of stocks, bonds, or other securities. This concept of collective investment gives investors access to a wider range of securities, which wouldn’t otherwise be feasible. A key advantage of mutual funds is the diversification they offer, mitigating individual security risks and potentially stabilising returns over time.
Types of mutual funds
Incorporating old mutual funds into your portfolio, either through a one-time lump sum investment or a SIP investment, can significantly contribute to achieving your broader financial objectives in various ways. Mutual funds are categorised based on their investment objectives, underlying assets, and the kind of returns they aim to generate. Here are some of the main types:
- Equity funds: These funds invest primarily in stocks and aim for growth by capital appreciation. They are suitable for investors with a higher risk tolerance looking for long-term returns.
- Debt funds: Focused on investing in bonds and other debt instruments, debt funds aim to provide regular income to investors. They are considered less risky compared to equity funds and are suitable for conservative investors.
- Hybrid funds: Combining the characteristics of both equity and debt funds, hybrid funds invest in a mix of stocks and bonds. They aim to balance the risk and return by diversifying across asset classes.
- Index funds: These funds aim to replicate the performance of a specific index, like the NSE Nifty or BSE Sensex, by investing in the same stocks in the same proportions. They are known for their lower expense ratios due to the passive management approach. Read more about, What is an index fund.
- Sectoral/thematic funds: These funds invest in specific sectors of the economy or follow a particular theme. While they can offer higher returns when the chosen sector or theme does well, they carry a higher risk due to their lack of diversification. Read more about, what are sectoral mutual funds.
Benefits of investing in mutual funds
Investing in mutual funds schemes comes with several advantages, making them an attractive option for many investors:
Professional management: Mutual funds are managed by experienced fund managers who take care of the research, selection, and monitoring of the investments, relieving investors from the complexities of direct investing.
- Diversification: By pooling resources with other investors, individuals can invest in a variety of securities, reducing the risk associated with investing in single or few securities.
- Accessibility: Mutual funds offer a lower entry point for investors, making it possible for individuals to start investing with relatively small amounts.
- Liquidity: Mutual fund units can typically be bought or sold with ease, offering higher liquidity compared to some other investment vehicles like real estate.
- Flexibility: Many mutual funds offer features like systematic investment plans (SIPs) and systematic withdrawal plans (SWPs), providing investors with flexibility in terms of investing and withdrawing funds according to their financial goals and needs.
Conclusion
The oldest mutual funds in India embody the rich history and growth trajectory of the Indian mutual fund industry. They offer investors a blend of stability, performance, and trust, making them a worthy consideration for your investment portfolio. By following the right steps and making informed decisions, you can leverage these time-tested investment vehicles to achieve your financial goals.
Mutual funds present a viable option for diversifying your investment portfolio, with choices ranging from conservative to more aggressive strategies. Whether you are looking to accumulate wealth over the long term, generate regular income, or both, there's likely a mutual fund that matches your investment profile and goals.
As always, it is advisable to do your research and consider consulting a financial advisor to choose the mutual fund that best suits your needs. The Bajaj Finserv Mutual Fund Platform provides a wide selection of mutual funds to choose from and has valuable resources to help make informed decisions.
