lowest return mutual funds: Mutual funds are considered one of the most preferred investment options today. Investors usually expect an average return of 12–14%, but the actual performance completely depends on stock market movements. Sometimes, instead of giving profits, certain mutual funds end up delivering negative returns, causing losses to investors.
In 2025, a few mutual funds have performed poorly and slipped deep into negative territory. If you are investing in any of these schemes, it is important to reassess your portfolio. Here are the funds that gave the lowest returns this year.
Mutual Funds That Delivered Negative Returns
Below is the list of schemes that have disappointed investors with negative returns:
| Mutual Fund Name | Return (%) |
|---|---|
| Samco ELSS Tax Saver Fund | -16.40% |
| Bandhan Nifty IT Index Fund | -14.20% |
| Axis Nifty IT Index Fund | -14.20% |
| Nippon India Nifty IT Index Fund | -14.00% |
| Navi Nifty IT Index Fund | -14.00% |
| Mirae Asset Nifty Smallcap 250 Momentum Quality 100 ETF FOF | -13% |
| DSP Nifty Smallcap 250 Quality 50 Index Fund | -12.20% |
| Quant Tech Fund | -12.20% |
Most of these underperforming schemes belong to IT and Smallcap categories, both of which were highly volatile this year.
Key Risk Factors to Check Before Investing
Understanding risk indicators helps you choose the right mutual fund and avoid high-volatility schemes. Here are the most important ones:
1. Beta
- Beta indicates how much a fund moves compared to the market.
- Beta < 1: Low risk
- Beta > 1: High risk
A high-beta fund reacts sharply to market ups and downs.
2. Standard Deviation
- Standard deviation shows volatility.
- Lower value = more stable fund
For example, if one scheme has a standard deviation of 5% and another 10%, the first one carries lower risk.
3. Sharpe Ratio
This ratio tells you how much return a fund gives compared to the risk taken.
- Below 1.00: Low risk
- 1.00 to 1.99: Moderate risk
- 2.00 to 2.99: High risk
- 3.00 and above: Very high risk
If a fund has a very high Sharpe Ratio, it usually means the scheme is extremely volatile.
Should You Worry If Your Fund is in This List ?
Negative returns do not always mean a fund is “bad.”
Some sectors face temporary corrections, while others may take longer to recover. Investors should always:
- Review their investment horizon
- Check risk factors
- Avoid panic selling
- Consult a certified investment advisor
Disclaimer
This article is for informational purposes only and not investment advice. Mutual funds are subject to market risks. Always consult a SEBI-registered advisor before investing.
