In the world of investments, there are numerous schemes and avenues to choose from. Each one promises to give you the best returns on your hard-earned money. However, not all schemes live up to their promises. It takes a discerning eye to identify the ones that truly deliver on their claims. And in this regard, the schemes that have stood out over the past five years are the ones that have produced an impressive Compound Annual Growth Rate (CAGR) between 24.2 and 35.5 per cent.
For those who are not familiar with the term, CAGR is a measure of the average annual growth rate of an investment over a specified period of time. In simpler terms, it reflects the real return on an investment, taking into account the compounding effect. Therefore, a higher CAGR indicates a better performance of a scheme.
Now, let us delve into the schemes that have produced CAGR between 24.2 and 35.5 per cent over the past five years. These schemes cover a diverse range of investment options and have proven to be consistent performers, even during volatile market conditions.
1. Equity mutual funds: Equity mutual funds have been the star performers in the investment world over the past five years. These funds invest in stocks of various companies and have produced a CAGR of 24.2 per cent. This impressive growth can be attributed to the overall bullish trend in the stock market and the skillful management of the fund managers. The key to investing in equity mutual funds is to stay invested for the long term, as it allows for the compounding effect to work its magic.
2. Small cap funds: Small cap funds are a type of equity mutual fund that invests in the stocks of small-sized companies. These funds have been able to produce a CAGR of 29.6 per cent over the past five years, making them one of the best-performing schemes in the market. While small cap funds are known to be high-risk, high-return investments, they have shown consistent growth over the years, making them a lucrative option for investors who are willing to take a bit of risk for higher returns.
3. Mid cap funds: Mid cap funds invest in the stocks of medium-sized companies and have produced a CAGR of 31.9 per cent over the past five years. These funds have been able to outperform their large-cap counterparts due to their ability to pick undervalued mid-sized companies with strong growth potential. Investing in mid cap funds requires a good understanding of the market and a long-term investment horizon.
4. Sector-specific funds: Sector-specific funds invest in a particular sector, such as banking, technology, or healthcare. These funds have produced a CAGR of 32.5 per cent over the past five years, making them one of the top-performing schemes. The key to investing in sector-specific funds is to carefully choose the sector and monitor its performance regularly. These funds are ideal for investors who have a good understanding of a particular sector and are looking for focused returns.
5. Systematic Investment Plans (SIPs): SIPs are a method of investing in mutual funds where a fixed amount is invested at regular intervals. Over the past five years, SIPs have produced a CAGR of 35.5 per cent. The beauty of SIPs lies in their ability to average out the cost of investments and take advantage of the market volatility. This makes them an attractive option for investors who are looking to invest in mutual funds but are hesitant to invest a lump sum amount.
The consistent and impressive growth of these schemes over the past five years is a testament to their potential as wealth creators. These schemes have not only outperformed other investment options but have also provided a safe haven for investors during market downturns. However, it is important to note that past performance does not guarantee future returns, and investors should always conduct their own research and consult with a financial advisor before making any investment decisions.
In conclusion, the schemes that have produced a CAGR between 24.2 and 35.5 per cent over the past five years have proven to be the shining stars in the investment world. They offer a diverse range of options for investors to choose from and have consistently delivered impressive returns. As the saying goes, “The early bird catches the worm,” and investors who have invested in these schemes have reaped the benefits of their wise decisions. So, if you are looking to grow your wealth
