Best Focused Funds

 

What are Focused Funds?

Focused funds are open-ended equity mutual funds that follow a concentrated investment strategy focusing on a limited number of stocks. According to the SEBI guidelines, focused funds can invest in up to 30 stocks with at least 65% of their fund portfolio invested in equities and equity-related instruments. SEBI guidelines also require these funds to mention their intended market capitalization exposure viz multi-cap, large-cap, small-cap or midcap. 

Why Invest in Focused Funds?

• A focused fund identifies and invests in high conviction stocks for higher returns
• Higher allocation to high conviction stocks usually delivers over the long term
• The concentrated approach reduces the opportunity cost of under-allocating to winning investment ideas
• Concentrated portfolios reduce the risk of over-diversification
• Higher allocation to winning stocks significantly changes the performance of the overall fund portfolio performance
• Select companies in a growing economy often exhibit higher earnings and growth irrespective of the business cycle

Table of Top 10 Focused Funds

Fund Name	Returns (%)
	1 year	3 year	5 year	10 year
ICICI Prudential Focused Equity Fund	10.17	21.97	22.19	16.35
Invesco India Focused Fund	-8.74	20.29	19.18	–
HDFC Focused Fund	7.28	20.17	25.00	14.85
DSP Focused Fund	2.95	18.24	15.66	12.97
Bandhan Focused Fund	-4.02	17.86	14.89	13.47
Mahindra Manulife Focused Fund	1.14	17.54	21.00	–
SBI Focused Fund	12.20	17.12	16.90	15.51
JM Focused Fund	-5.05	16.44	15.74	13.89
Canara Robeco Focused Fund	1.86	16.21	–	–
Edelweiss Focused Fund	-1.78	16.15	–	–

Data as on December 9, 2025

Who Should Invest in Focused Funds?

• Those aiming for wealth creation with investment horizons of at least 3-5 years
• Staying invested in the long term to increase the possibility of generating positive returns
• Those with aggressive risk profile seeking to benefit from equity investing through a focused portfolio consisting of high conviction bets