Best High Risk Mutual Funds in India 2026: Top 10 & Guide
What High Risk mutual funds are, who should invest, key risks, and the top 10 funds with returns and risk data.
High-risk mutual funds carry significant volatility in exchange for the potential of sizeable returns, usually through stocks or bonds of growing companies. They suit informed investors with a strong risk appetite and a long horizon. This guide covers what defines them, who they suit, benefits, and a top 10 list of funds with high-risk labels from our data.
Key takeaways
- High-risk funds have a significant risk-reward dynamic: more chance of loss and more chance of strong returns.
- They invest mainly in stocks or bonds of developing or growing companies, and include several fund types.
- They tend to work best over 5 to 7 years and suit investors with market knowledge and a strong risk appetite.
- Tax treatment depends on the fund's asset allocation, and you can choose direct or regular plans.
- The top 10 funds below carry high-risk riskometer labels and are ranked by an internal score.
What are high-risk mutual funds?
High-risk funds have a significant risk-reward dynamic compared with most other funds. Here, risk is the probability of losing your investment, and low, moderate and high describe comparative degrees of that probability.
What are the features of high-risk funds?
- Type: high-risk funds include balanced advantage schemes, credit risk schemes and equity hybrid schemes, among others.
- Asset allocation: they mainly hold stocks or bonds of developing or growing companies, and the exact mix depends on the type.
- Risk-reward: significant volatility, with the potential for sizeable returns.
Who are high-risk funds suited for?
They suit investors with in-depth market knowledge and a fair understanding of macroeconomic trends, plus a strong risk appetite and comfort with volatility. High-risk funds usually offer larger returns over a long period because the underlying holdings are mostly companies in a growth phase.
What should you consider before investing?
- Investment goal: identify long-term goals and set realistic benchmarks.
- Risk profile: know how much loss you can absorb, and size your investment accordingly.
- Fund performance: check historical returns and compare with peers.
- Expense ratio: it varies between AMCs and affects returns.
- Direct vs regular plan: direct plans are offered without intermediaries and at a lower expense ratio.
Advantages of high-risk mutual funds
- Higher return potential: debt funds buy low-rated bonds that can pay more, while equity funds target growth.
- Long-term capital appreciation: they tend to perform best over 5 to 7 years.
- Possible tax efficiency for investors in higher tax slabs compared with bank fixed deposits.
- Chance to beat benchmarks in a positive market cycle.
- Two ways to invest: SIP or lump sum.
How are high-risk mutual funds taxed?
Taxation follows the fund's asset allocation: equity-oriented funds are taxed under equity rules and debt-based funds under debt rules, and dividends above certain limits can attract TDS. Rules change, so check the current position or speak to a tax advisor.
Do you need KYC before investing?
Yes. No investor can start investing in mutual funds without completing KYC (Know Your Customer), a one-time process mandated under the Prevention of Money Laundering Act (PMLA) for every first-time investor. It can be done online through e-KYC, for example with an Aadhaar OTP and your PAN.
Top 10 High Risk mutual funds ranked by an internal score
These are the top 10 High Risk funds from our data, ranked by Invo Wealth's internal fund-quality score. The score itself is not shown, only the return and risk numbers behind it. This list covers funds across categories whose SEBI riskometer label falls in this risk band. A "--" means the fund has not completed that period or the data is unavailable. Some entries are different plan or option variants of the same scheme (for example Direct vs Regular, or Growth vs Bonus), so their figures can look similar.
Returns across 6 months to 5 years
Performance data as of 5 September 2026.
| Fund | 6M CAGR | 1Y CAGR | 3Y CAGR | 5Y CAGR |
|---|---|---|---|---|
| HDFC Focused Fund | 0.93% | 0.83% | 14.97% | 17.33% |
| HDFC Flexi Cap Fund | 4.93% | 3.37% | 15.64% | 17.10% |
| ICICI Prudential Aggressive Hybrid Fund | 1.93% | 2.40% | 13.34% | 14.78% |
| ICICI Prudential Focused Fund | 4.98% | 2.59% | 16.16% | 14.57% |
| ICICI Prudential Large & Mid Cap Fund | 7.44% | 4.61% | 15.40% | 16.12% |
| HDFC Mid Cap Fund | 16.81% | 10.84% | 18.09% | 19.77% |
| ICICI Prudential Large Cap Fund (erstwhile Bluechip Fund) | -4.37% | -2.08% | 11.17% | 11.12% |
| ICICI Prudential Value Fund (erstwhile Value Discovery Fund) | -7.73% | -2.07% | 12.15% | 14.56% |
| Nippon India Large Cap Fund - Regular Plan - Bonus Option | -2.29% | -1.95% | 10.83% | 12.83% |
| Nippon India Large Cap Fund - Regular Plan - Growth Option | -2.29% | -1.95% | 10.83% | 12.83% |
Risk and consistency metrics
| Fund | ISIN | Volatility | Max drawdown (3Y) | Sortino ratio |
|---|---|---|---|---|
| HDFC Focused Fund | INF179K01574 | 14.11% | -14.07% | 0.80 |
| HDFC Flexi Cap Fund | INF179K01608 | 14.41% | -13.45% | 0.85 |
| ICICI Prudential Aggressive Hybrid Fund | INF109K01480 | 11.90% | -11.41% | 0.74 |
| ICICI Prudential Focused Fund | INF109K01BZ4 | 16.21% | -17.16% | 0.80 |
| ICICI Prudential Large & Mid Cap Fund | INF109K01431 | 15.63% | -15.09% | 0.75 |
| HDFC Mid Cap Fund | INF179K01XQ0 | 18.11% | -16.76% | 0.83 |
| ICICI Prudential Large Cap Fund (erstwhile Bluechip Fund) | INF109K01BL4 | 15.11% | -15.61% | 0.39 |
| ICICI Prudential Value Fund (erstwhile Value Discovery Fund) | INF109K01AF8 | 13.48% | -14.20% | 0.54 |
| Nippon India Large Cap Fund - Regular Plan - Bonus Option | INF204K01554 | 16.31% | -15.69% | 0.32 |
| Nippon India Large Cap Fund - Regular Plan - Growth Option | INF204K01562 | 16.31% | -15.69% | 0.32 |
These are the funds whose SEBI riskometer label falls in the high-risk bands. They come from different categories, so compare each only with similar funds and read volatility and drawdown before returns.
How to invest in High Risk mutual funds
You can invest in these funds using the Invo Wealth app. Sign up, get complete portfolio insights and start investing in mutual funds that actually suit you.
Conclusion
High-risk funds can reward patient, informed investors but can also fall sharply. Invest only what you can afford to see fluctuate, and keep the horizon long.
Frequently asked questions
What are high-risk mutual funds?
They are funds with a significant risk-reward dynamic compared with most other funds. They involve significant volatility but also aim for sizeable returns.
What types of funds are high risk?
Categories include balanced advantage, credit risk and equity hybrid schemes, among others, usually investing in stocks or bonds of developing or growing companies.
Who are high-risk funds suited for?
Investors with in-depth market knowledge, a fair understanding of macroeconomic trends and a strong risk appetite who are comfortable with volatility.
What time horizon suits high-risk funds?
They tend to perform best over 5 to 7 years, and the source notes they can reward patience over horizons of up to 10 years.
How can I invest in high risk mutual funds?
You can invest through a SIP or a lump sum. To invest in these funds, you can use the Invo Wealth app: sign up, get portfolio insights and start investing.
Mutual fund investments are subject to market risks; read all scheme-related documents carefully. This article is for education only and is not investment advice. Past performance does not guarantee future returns. Invo Wealth is an AMFI-registered mutual fund distributor (ARN-368528).