Only 4 global funds are accepting fresh investments: How they stack up against Nifty 50

Indian investors looking to diversify overseas have plenty of international mutual funds to choose from on paper. The problem is that fresh investments remain suspended in most of them.

At present, only four international mutual fund schemes are open for fresh investments – Baroda BNP Paribas Aqua FoF and three schemes from HSBC Mutual Fund. The HSBC schemes reopened for investments from August 18, while Baroda BNP Paribas Aqua FoF resumed fresh investments earlier this month.

The limited reopening comes at a time when several overseas markets have delivered strong returns even as Indian equities have struggled. The Nifty 50 is down 7.33 percent so far in 2026 and 3.47 percent over the past year.

So, what options do Indian investors currently have, and how have they performed?

Four international funds currently open

Baroda BNP Paribas Aqua FoF resumed all fresh investments from August 3, 2026.

HSBC Mutual Fund, meanwhile, reopened three schemes – HSBC Asia Pacific (Ex Japan) Dividend Yield Fund, HSBC Brazil Fund and HSBC Global Emerging Markets Fund – with effect from August 18.

Investors can make fresh or additional lump-sum investments, switch-ins and investments through systematic investment plans (SIPs), systematic transfer plans (STPs) and IDCW Transfer Plans in these three schemes.

There is, however, a cap. Investments across the permitted routes in the three HSBC schemes are restricted to Rs 2 lakh per PAN per month.

The fund house had temporarily suspended subscriptions in these schemes in December 2025.

How have the four open funds performed?

The performance of the four available schemes varies considerably, reflecting the very different markets and investment themes they provide exposure to.

HSBC Global Emerging Markets Fund has delivered the highest return among the four, gaining 31.70 percent YTD and 53.12 percent over one year. HSBC Asia Pacific (Ex Japan) Dividend Yield Fund follows with returns of 24.90 percent and 40.07 percent, respectively.

Baroda BNP Paribas Aqua FoF, which provides exposure to the global water theme, has returned 13.40 percent YTD and 14.06 percent over one year. HSBC Brazil Fund has gained 10.16 percent this year, though its one-year return is considerably higher at 28.32 percent.

For context, the Nifty 50 has declined 7.33 percent YTD and 3.47 percent over the past year. All four overseas funds currently accepting fresh investments have therefore delivered positive returns over these two periods.

This, however, should not be read as a like-for-like comparison. The schemes invest across different countries and themes and carry risks that are very different from those of a domestic large-cap index.

Global markets: Korea, Taiwan and Japan lead

Performance across international markets has also been far from uniform. Asian markets such as South Korea, Taiwan and Japan have posted sharp gains, while some other markets have delivered relatively modest or even negative returns.

The numbers show why simply referring to a “global market rally” can be misleading. South Korea’s KOSPI is up 62.73 percent YTD and Taiwan’s benchmark 54.87 percent, while Japan’s Nikkei 225 has gained 31.56 percent. At the other end, Indonesia’s IDX Composite is down nearly 25 percent this year, while India and Vietnam are also in negative territory.

Why are so few international funds accepting money?

The constraint largely stems from limits on how much Indian mutual funds can invest overseas. The mutual fund industry has an overall limit of $7 billion for investments in overseas securities, while investments in overseas exchange-traded funds are subject to a separate industry-wide limit.

Industry experts say, as fund houses approached these limits, several international schemes stopped accepting fresh investments, leaving investors with fewer options despite continued interest in geographical diversification.

For investors, the reopening of four schemes provides some room to invest internationally, but fund selection becomes important. A Brazil-focused fund, an emerging-markets fund, an Asia-Pacific strategy and a global water-themed fund serve very different purposes. Recent returns can show how these markets have performed, but they should not be the sole reason for choosing an overseas fund.

Experts say, international exposure is better viewed as a diversification allocation alongside domestic investments, with the choice depending on the geography, underlying portfolio, currency risk and the role the fund is expected to play in an investor’s overall portfolio.

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