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The frontline index Nifty 50 touched 26,000 levels on October 23 after nearly 13 months when it last closed at record highs (September 27, 2024). As markets chartered a volatile path over the past year or so, equity mutual funds from the top five categories have given a reasonably healthy account of themselves in beating their respective benchmark indices on absolute as well as SIP returns basis. Consider this. The top five categories, with over ₹20 lakh crore in total corpus and which account for 60 per cent of the active equity mutual funds AUM (assets under management) have 158 schemes currently operational. Of these, roughly 92 schemes have done better than their benchmark on an absolute basis over the past 13 months and 99 funds have outperformed the corresponding indices on an SIP basis over this period. That is roughly six in 10 funds outperformed in each case. As domestic investors pour over ₹29,000 crore every month, it is clear that they see their funds had coped well in the gyrating markets of the past year. Gauging indices We have taken the Nifty 100 TRI as the benchmark for large-cap, Nifty Large Midcap 250 TRI for large- and mid-cap, Nifty Midcap 150 TRI for mid-cap, Nifty Smallcap 250 TRI for small-cap and Nifty 500 TRI for flexi-cap funds. Only the direct plans of funds are considered. Absolute returns for the indices and funds are taken from September 27, 2024 to October 23, 2025. SIP returns (XIRR: extended internal rate of return) are taken for 13 instalments (September 27, 2024 to September 27, 2025), with the valuation date as October 23, 2025. Now, all the indices recorded negative returns on an absolute basis. In contrast, on an SIP basis, the XIRR is positive for all indices over the 13-month period. Scoring on SIPs Large-cap funds delivered the best performance on an absolute returns basis among the five categories. Around 66 per cent, or two-thirds, of the funds in the category beat the Nifty 100 TRI over the September 2024-October 2025 period. Curiously, the category saw fewer funds outperform on an SIP basis, perhaps because large-caps corrected less during the year, offering fewer opportunities for SIPs to capitalise on volatility. Flexi-cap funds scored well on both absolute and SIP returns basis. Around 64 per cent funds from the category outperformed the absolute returns of the Nifty 500 TRI, while 67 per cent did better than the benchmark on an SIP basis. For a category that is considered most risky, small-cap funds managed to deliver robust performances with 61 per cent of the schemes beating the Nifty Smallcap 250 TRI and 66 per cent getting past the benchmark on an SIP basis. Large- and mid-cap funds put out middling performances with slightly over half the funds beating the benchmark index on an absolute and XIRR basis. Mid-cap funds delivered a performance that was underwhelming compared to other categories as only 45 per cent funds bettered the Nifty Midcap 150 TRI on absolute returns. But investors taking the SIP route would have been better rewarded with 62 per cent funds outperforming the benchmark. A couple of pointers become clear here from an investor’s perspective even though this analysis covers only the performance in the recent past. Continuing SIPs during volatile and falling markets is very important to average costs and generate better returns, more so for the long term. For riskier categories such as mid- and small-caps, taking the SIP route gives a better chance at beating the benchmark. While this reinforces the importance of continuing SIPs during volatile markets, it is worth noting that these observations are drawn from a relatively short 13-month window. This short-term pattern simply echoes the longer-term benefits seen across previous market cycles. Published on October 25, 2025
