Top 5 Mutual Funds That Doubled ₹10 Lakh in 4 Years

Being one of the most popular investment options for individuals, the top mutual funds are often sought after. However, finding the best ones is not always an easy feat. Investors go about searching online, asking friends, or browsing forums. That is why we have curated a list of the top 5 mutual funds in India. These are the mutual funds that have given strong returns. Explore categories that have shown >20% CAGR over multi-year periods.

Best 5 Mutual Funds to Invest In

What CAGR / Return is Needed to Double in 4 Years

Now that you know the top 5 mutual funds, let’s explore some important details. To double the money in 4 years via a lump sum (depositing ₹10,00,000 once, to get ~₹20,00,000 after 4 years), the CAGR required is:

Required CAGR (2)1/4−1≈18.9%≈19% per annum

This implies that any mutual fund whose lump-sum investment had given returns of about 19 to 25 per cent annually in the last 4 years has either achieved or come very close to achieving double. Many funds in these small-cap/mid-cap/sectoral/thematic categories have given such returns, but for shorter periods (3 years).

Why It’s Hard and What to Check

• Past performance: Past performance does not give any guarantee for the future. What could have worked for 2-3 years may not work in the 4th year.
• Volatility: Larger returns have the propensity to be hit by large ups and downs. If you require liquidity or panic selling, chances are you may lose a great deal.
• Regulatory/thematic risk: Infrastructure, PSU, technology, and small-cap stocks are most sensitive to government policy, interest rates, global macro, and other matters
• Fund management and costs: Expense ratio, tracking error (for index or passive), or stock selection (for active funds).
• Luck & macro: An interest rate uptrend, supportive global flows, etc., assist these gains. Reverse the cycles; reverse gains.

How Investors Can Actually Double Their Money

One can go with this very practical plan if he aims to double about ₹10 lakh in approximately 4 years (or something close to that).

1. Deciding on the Mode of Investment:

• Lump-sum: Putting the full ₹10 lakh (or whatever capital amount) at once. The advantage is that if markets rise, you stand to gain fully. However, if markets fall immediately, it is detrimental to you.
• SIP / Phased lump-sum / Staggered Investment: Invest gradually, say, over a few months or quarters, to average the entry cost (rupee cost averaging). Such investing reduces downside risk in volatile markets. To double the target, SIP has to contribute to a larger monthly amount or extend the horizon on which reaching the required multiple is possible.

If you already have idle capital, a lump sum in a high-growth vehicle can help achieve the doubling target faster but with higher risk. SIPs provide smoother entry and reduced volatility but generally need either more money or more time to achieve the same goal.

2. An Appropriate Choice of Fund Category (or Style)

• Mutual funds giving the wonders of 20%+ CAGR should be:
• • Small-cap/Mid-cap
  • Sectoral/thematic (for instance, technology, infrastructure, power, etc.)
  • Flexi-cap/Multi-cap funds that shift exposure opportunistically
  • Maybe Aggressive hybrids or some flexi-hybrid funds in a favourable market

Do not count on large-cap or debt funds if rapid doubling is the goal (they are steadier, lower risk, but lower upside).

3. Time Horizon

• At a minimum, it should be 4-5 years if one wants to have a good chance of doubling their money.
• Anything less is just risky.
• If it is 5 years plus, then compounding works smoothly, and chances are higher. But if the target is 4 years, more volatility must be accepted.

4. Diversification

• Don’t dump the entire ₹10 lakh into one fund or one theme. Diversify among 2-3 high-potential funds + a balanced fund to spread out the risk.
• By way of illustration: 50% in small-/mid-cap funds, 30% in flexi-cap or thematic, 20% in a relatively safer large-cap or flexi-cap to act as a shelter.

5. Monitoring & Rebalancing

• Funds must be reviewed on a periodic basis (annually or semi-annually) to check if the strategy used is still the relevant one, or if a new Fund Manager is more suitable.
• If one fund happens to perform badly, a partial cut can be observed in it in favour of reasonably performing ones. Otherwise, avoid churning! Keep an eye on expense ratios, turnover cost, tax drag, etc.

6. Expect Realistic Return Bands and Prepare for Drawdowns

• Even the best fund managers will have periods, often 1–2 years, when performance is weak.
• In small- and mid-cap segments, investors should be prepared for 20–40% drawdowns during such times.
• Being mentally and financially ready to hold through these phases is important.
• At least one year of flat or negative returns should be expected over the investment cycle. To compensate, the remaining years must deliver strong growth, around 18–20% or higher to ensure overall returns stay on track.

7. Tax & Costs to Consider

• Tax implications: Equity mutual funds in India: long-term capital gains (LTCG) over 1 year are taxable (10% over ₹1 lakh gains per annum). So plan for tax when you exit.
• Direct plans have lower costs than regular plans. So go with direct if possible.

Action Steps for You

• Check the latest 4-year CAGR: Find out the latest 4-year CAGR of these funds through the AMFI or direct fund house websites and see if any of the funds have already crossed a 4-year 19% CAGR.
• Decide on your risk tolerance: If you can tolerate up and down swings of 30-40%, then small/mid/theme funds are okay. If not, perhaps a little more diversification should be welcomed, though it calls for accepting a longer time.
• Choose the investment method: Say, if you get, say, ₹10 lakh now, toss in a 50% lumpsum, keeping the other 50% ready to dip into dips for phased investment.
• Choose 2-3 funds: don't like putting all your eggs in one basket. Among high-growth funds, choose at least two funds plus another set of funds considered more stable.
• Monitor annually: Monitor annually, but don't frequently change based on short-term drops.
• Have an exit strategy: Around 4 years or when the fund has made good gains, think about a partial exit or shifting partially to lower-risk funds to lock in the gains.

Wrapping Up

It is not impossible to double your money in just 4 years through mutual funds, but one needs to be wise, patient, and risk-tolerant. The 5 best mutual funds in India with annualised returns of ~20% or more in historical terms, such as Nippon India Small Cap, Motilal Oswal Mid Cap, Quant Small Cap, Parag Parikh Flexi Cap, and some thematic funds, show that investing with discipline builds wealth.

At My Mudra, our goal is to simplify finance for the everyday investor. Whether you are looking into the top 5 best mutual funds worth investing in or preparing for long-term wealth creation, My Mudra brings to you actionable insights, trusted data, and personalised support, so you make your money work harder for you.

Also Read:
- Top 10 Best Mutual Funds in India 2025
- How to Invest in Mutual Funds for Beginners