Investing in equity mutual funds has become a popular investment strategy among Non-Resident Indians (NRIs) in recent years. NRI Mutual funds are a well-known growth vehicle for NRIs to invest for better returns and wealth creation in the long run in India. With India’s robust economic growth and a well-regulated financial market, NRIs have ample opportunities to grow their wealth through equity investments. In 2024, the investment landscape continues to evolve, offering a variety of equity mutual funds tailored to suit different risk profiles and financial goals. In this blog, we will explore some of the best equity mutual funds for NRIs to invest in for the year 2024.
Also read: Best SIP to Invest in 2024 – Top 10 SIP Mutual Fund Plans for NRIs/OCIs
What is an Equity Mutual Fund?
Equity mutual funds are a type of mutual fund that predominantly invests in the shares/stocks of the listed companies. Equity mutual funds are also known as growth funds and can be active or passive. Active equity mutual funds are those where the fund manager pools the investment funds of the investors into various stocks based on market conditions, performance, research, and more while passive equity funds are those where the fund manager builds a portfolio to mirror the market index, i.e. Nifty 50 or BSE Sensex.
Equity mutual funds can also be further classified into various types as per the market capitalization, i.e. Large-Cap, Mid-Cap, Small-Cap, or at times Flexi-Cap. Not to forget the various sectoral funds or thematic funds invested into particular fields like ESG funds, tech funds, and more.
Also read: 10 Mutual Funds That Doubled Wealth In 5 Years
Can NRIs invest in Equity Mutual Funds?
Yes, NRIs can easily invest in equity mutual funds after getting their Mutual Fund KYC done and linked to their NRO/NRE Bank accounts. They can invest in various mutual fund schemes and generate good returns in the long term. This helps NRIs to build a fund that can match their investment goals and secure their future for any long-term financial needs.
The FEMA Act, RBI rules, and SEBI guidelines govern the rules and regulations regarding NRI investments in mutual funds which is why it has a slightly different procedure than that of resident individuals. Keeping in check with the FEMA Act, the funds on offer for NRIs from the US & Canada to NRIs from other countries may vary at times. However, on a generated note, NRIs can easily invest in equity mutual funds.
Also read: Top 5 Tips for NRIs to Pick a Winning Mutual Fund
What are Equity Mutual Funds vs. Debt Mutual Funds?
Equity funds are the type of mutual funds that primarily invest in the equity market or stocks of the companies. These funds are also known as growth funds for their ability to provide growth in terms of return and wealth building in the long run. Debt mutual funds on the other hand is the type of mutual fund vehicle that invests primarily in government securities and corporate debts. Debt mutual funds are deemed safer than equity mutual funds since they invest the funds in safer options. At the same time, equity mutual funds have a higher earning potential.
What are the Top 10 Best Equity Funds for NRI 2024?
In this section, we look at some of the best equity funds for NRIs 2024. We have created the list of Top 10 Best Equity NRI Mutual funds regarding the overall fund performance and have also taken note of the expense ratio and other areas. These top equity funds for NRIs are great options to start your investment.
Top 10 Performing Equity Funds for NRIs in 2024
| Fund Name | Fund Size (In Crores) | Expense Ratio | 1 YR | 3 YR |
| Quant Small Cap Fund-Growth for NRI | 11,207 Cr | 1.7% | 48.90% | 44.12% |
| Quant Infrastructure Fund Growth for NRI | 1130 Cr | 2.1% | 34.14% | 39.56% |
| Nippon India Small Cap Fund-Growth for NRI | 41,019 Cr | 1.5% | 50.56% | 38.51% |
| Axis Small Cap Fund Growth for NRI | 17,916 Cr | 1.6% | 35.45% | 28.76% |
| ICICI Prudential Smallcap Fund Growth for NRI | 6,989 Cr | 1.8% | 26.94% | 37.61% |
| Quant Tax Plan Growth for NRI | 6608 Cr | 1.8% | 39.60% | 30.99% |
| Kotak Small Cap Growth for NRI | 13,377 Cr | 1.7% | 36.12% | 28.44% |
| PGIM India Midcap Opportunities Fund Growth for NRI | 9,800 Cr | 1.7% | 21.87% | 22.51% |
| Quant Mid Cap Fund Growth for NRI | 3,781 Cr | 1.9% | 36.04% | 31.69% |
| Nippon India Multi Cap Fund – Growth for NRI | 22,695 Cr | 1.7% | 41.36% | 32.67% |
Also read: List of Top Performing Liquid Funds for NRIs in 2024
Investment tools for NRIs to invest in Equity Mutual Funds
Majorly there are two tools for any basic NRI investment in India, which are:
- Non Resident External (NRE) Account: To invest on a repatriable basis
- Non Resident Ordinary (NRO) Account: To invest on a non-repatriable basis
An NRI can invest in Mutual Funds In India using the above-mentioned accounts.
How to Invest in Equity Funds as NRI?
NRIs can now download the SBNRI App and choose to invest in different equity mutual fund options in India with ease. You can also get detailed investment advice from experts at SBNRI. Also, visit our blog and YouTube channel for more details.
SBNRI is an authorized Mutual Fund Distributor platform & registered with the Association of Mutual Funds in India (AMFI). ARN No. 246671. NRIs willing to invest in mutual funds in India can download the SBNRI App to choose from 2,000+ mutual fund schemes or can connect with the SBNRI wealth team to better understand Mutual Fund investments.
FAQs
Which is an equity fund?
- Equity mutual fund is a type of mutual fund that invests its money in stocks/shares of the company.
Can NRI invest in equity funds?
- Yes, NRI investors can invest in equity funds after getting their Mutual Fund KYC done and linked to their NRE/NRO bank account.
Which is the best Equity fund for NRI to invest in 2024 for the highest return?
- Nippon India Small Cap Fund-Growth for NRI is the best equity fund for NRI to invest in 2024. It has given a return of 50.56% for 1 year and 38.51% for 3 years.
What is the taxation for equity funds for NRI?
- If equity investments are sold within one year of holding by NRIS, then the returns will be treated as short-term capital gain and will be taxed at 15% plus cess. However, if the funds are sold after one year of holding, it accounts as long long-term capital gain and the returns up to Rs 1 lakh will be tax-free. Any returns above Rs 1 lakh will be treated to a taxation of 10% plus cess without any indexation benefit.
Are equity mutual funds safer for NRIs?
- Equity mutual funds have a high volatility and can be a risky investment for investors. However, overseeing the returns generated by equity mutual funds for the past 15 years, these funds can be a great investment vehicle and offer great wealth-generation opportunities for NRIs.
Is equity funds safer than FD?
- Fixed deposits have a risk-free fixed income and are safer than equity mutual funds. However, as per the returns and growth opportunity, equity mutual funds look to be a better investment option for investors, residents, and NRIs alike.
Is it better to invest in equity funds?
- Equity funds are a great investment option for NRIs as they help to generate good returns and wealth creation in the long run. Investors can invest in equity mutual funds in either lumpsum or SIPs as per their desire and grow wealth.
