As global markets shift and grow, Indian investors are increasingly looking towards US-focused mutual funds for portfolio diversification and growth. With a stable economic outlook and growing technology sector, the US market remains a strong option for investors. Recent trends show that many Indian mutual funds with US exposure are delivering impressive returns, and experts are advising investors to consider these options, especially given the market stability post-elections in the US.
Why Invest in US-Focused Mutual Funds?
The US stock market, driven by a robust technology sector and an established economy, offers unique growth potential. Investing in funds focusing on US stocks not only allows Indian investors to diversify but also enables them to capture opportunities outside the Indian market.
Here are some compelling reasons to consider US-focused mutual funds:
- Global Growth Exposure: The US remains at the forefront of innovation, particularly in tech, healthcare, and consumer goods. By investing in US-based companies, Indian investors can participate in the growth of global giants like Apple, Amazon, and Tesla.
- Portfolio Diversification: Adding international funds can help balance risk, as the Indian and US markets don’t always correlate. This way, investors protect themselves against local market volatility while also gaining exposure to diverse economic sectors.
- Steady Returns: Recent data show that funds with US exposure have provided steady returns, making them attractive options for those who want stability without sacrificing growth potential.
Expert Insights: Benefits of Investing in US Markets Long-Term
Experts like Mohit Bhandari, co-founder and CEO of Stratzy, believe the recent clarity in the US political landscape contributes to market stability, which benefits both businesses and investors. “Markets thrive on stability and predictability,” Bhandari notes, emphasizing that reducing uncertainty allows companies and investors to make more confident decisions.
Shruti Jain, Chief Strategy Officer at Arihant Capital, also highlights that investors should focus on the long-term potential of US markets, not just short-term fluctuations. “Once election-related uncertainty subsides, the focus shifts back to fundamentals like economic data and corporate earnings,” she adds, advising investors to look beyond short-term ups and downs.
Top US-Focused Mutual Funds with Strong Returns
Here’s a look at some popular mutual funds in India with significant US exposure and their recent performance:
| Fund Name | 1-Year CAGR Returns | 3-Year CAGR Returns |
|---|---|---|
| Kotak Nasdaq 100 FOF (G) | 44.60% | 13.30% |
| ICICI Prudential US Bluechip Equity Fund (G) | 29.70% | 10.30% |
| Motilal Oswal Nasdaq 100 FOF (G) | 34.90% | 11.20% |
| Edelweiss US Technology Equity FoF (G) | 44.30% | 5.10% |
| Navi NASDAQ 100 FoF (G) | 39.60% | |
| Bandhan US Equity FOF (G) | 39.90% | 11.70% |
| Mirae Asset S&P 500 Top 50 ETF FOF (G) | 44.40% | 14.90% |
| DSP US Flexible Equity Fund of Funds (G) | 26.20% | 9.40% |
| SBI International Access – US Equity FOF (G) | 41.40% | 11.10% |
(Data source: Scribbox)
These funds have provided strong returns, with some showing impressive annualized growth rates even over a three-year span. For example, the Kotak Nasdaq 100 FOF and Edelweiss US Technology Equity FoF have achieved returns exceeding 40% in the last year alone, driven by the strong performance of US tech companies.
Should You Invest in US-Focused Mutual Funds?
For Indian investors interested in adding an international dimension to their portfolios, US-focused mutual funds present a good opportunity. However, experts advise focusing on long-term potential rather than short-term gains. By investing in these funds, investors benefit from a diversified portfolio that can potentially provide stability and growth across economic cycles.
It’s essential, however, to assess one’s risk tolerance and financial goals. Investing in international mutual funds carries currency risk as well as exposure to foreign market conditions. But for those prepared for the long haul, these funds offer a way to participate in the US market’s strengths.
As always, consult a financial advisor before making any investment decisions to ensure alignment with your individual investment objectives.
