Summary of this article
18 equity mutual funds delivered zero or negative 1-year returns.
Small-cap and flexi-cap funds made up most of the laggards, including several large schemes.
Equity funds should be judged over longer periods.
An investor invests in mutual funds with the basic aim of growing her money. But what if the fund where the investor has invested disappoints with 'zero' returns. 18 mutual funds across equity mutual fund categories have disappointed investors with zero per cent growth in the last year. In fact, out of these 18 equity funds, 12 funds eroded investors' money by delivering negative returns in the same time period, according to data from Ace Mutual Fund.
For the study, we have included equity funds in categories including large-cap, mid-cap, large & mid-cap, small-cap, flexi-cap funds, multi-cap, tax saving (Equity Linked Savings Scheme , ELSS) funds, value-oriented funds, and contra funds.
Out of the 18 funds in the list, seven were small-cap funds, four were flexi-cap funds, two were tax saving (ELSS) funds, two were multi-cap funds, one mid-cap fund, one focused fund, and one value fund.
According to the analysis, mutual fund investors have invested a massive Rs 1.29 lakh crore in these funds as of October 31, 2025. Some of the prominent names, in terms of the assets over Rs 10,000 crore, are: SBI Small Cap Fund (Rs 36,945 crore), Kotak Small Cap Fund (Rs 18,024 crore), HSBC Small Cap Fund (Rs 16,548 crore), Tata Small Cap Fund (Rs 11,792 crore), and Franklin India Small Cap Fund (Rs 13,790 crore).
SBI Small Cap Fund, the largest fund in the small-cap space, has given gloomy 0.6 per cent returns in the last 1 year, as on November 15, 2025. Another big fund in the small-cap space, Kotak Small Cap Fund, has decreased by 2.70 per cent in the last 1 year. Similarly, HSBC Small Cap Fund has given -2.20 per cent returns, Franklin India Small Cap Fund has disappointed with 0.94 per cent returns, and Tata Small Cap Fund went down by 6.25 per cent over the period under consideration.
Other big funds like Quant Multi Cap Fund (0.14 per cent), Quant Mid Cap Fund (-0.15 per cent), JM Flexi Cap Fund (-0.83 per cent), younger fund- NJ Flexi Cap Fund (-1.26 per cent), Bank of India Small Cap Fund (0.63 per cent), Motilal Oswal Focused Fund (-1.01 per cent), and JM Value Fund (0.16 per cent) too disappointed investors in the last one year with sub par returns. These funds hold assets between Rs 1,000 crore and Rs 10,000 crore.
Worst performers in the last one-year period were a smaller player in the flexi cap space, Samco Flexi Cap Fund. It has yielded returns of -11.32 per cent, followed by the Tata Small Cap Fund, Samco ELSS Tax Saver Fund, Samco Multi Cap Fund, and Kotak Small Cap Fund.
Clearly, 2025 has not been a great year for investors since equity funds are dependent on the market’s performance. But one year is too short a time period to gauge the performance of an equity fund. Investors should always invest in equity funds with a long-term horizon of at least 7 years. In the short term, equities tend to be volatile.
