Top 5 Small Cap Index Funds: Up to 26% return in 3 years turned Rs 2 lakh investment into Rs 3.98 lakh

Top Small Cap Index Funds in 3 Years: Small cap mutual funds are high-risk, high-growth equity funds. They invest in companies that are 251st and above in the list of the highest market capitalisation firms. Investors seeking a high growth opportunity through mutual fund investment often invest in small cap funds. Since small caps have a large ocean of companies, it is not easy to pick the fund with the right mix of stocks.

An alternative to this can be to pick small cap index funds.

They follow a small cap index such as Nifty Smallcap 250 or BSE 250 Smallcap.

They can mirror the index as it is or may have representation of all stocks in different proportions.

For mutual fund investors with little knowledge of small cap funds or who have a lack of time to track their small cap fund investments, small cap index funds save time and effort to follow performance.

Here, we take you through the top 5 small cap index mutual funds with the highest annualised return (CAGR) in 3 years. Also know how a Rs 2,00,000 lump sum (one-time) investment has performed in each of them.

Aditya Birla Sun Life Nifty Smallcap 50 Index Fund Direct-Growth

The fund has given a 25.79 per cent annualised return in the 3-year period.

It has assets under management (AUM) of Rs 3,585 crore, while its net asset value (NAV) as on May 16, 2025, was Rs 44.0997.  

Benchmarked against NIFTY Infrastructure TRI, the fund has given 19.48 per cent annualised return since its inception in January 2013.

At an expense ratio of 0.66 per cent, the fund has Rs 1,000 as the minimum SIP and Rs 5,000 as the minimum lump sum investment. 

A Rs 2,00,000 one-time investment in 3 years has jumped to Rs 3,98,078.

Axis Nifty Smallcap 50 Index Fund Direct-Growth

The fund has given a 25.65 per cent annualised return the 3-year time frame.

It has assets under management (AUM) of Rs 447 crore, while its net asset value (NAV) as on May 16, 2025, was is Rs 17.79.  

Benchmarked against NIFTY Smallcap 50 TRI, the fund has given 20.04 per cent annualised return since its launch in February 2022.

With an expense ratio of 0.27 per cent, the fund has Rs 105 as the minimum SIP and lump sum investment each. 

A Rs 2,00,000 one-time investment in the 3-year period has converted into Rs 3,96,750.

Motilal Oswal Nifty Smallcap 250 Index Fund Direct – Growth

The fund has given a 23.92 per cent annualised SIP return in the 10-year period.

It has a fund size of Rs 822 crore, while its unit price as on May 16, 2025, was Rs 36.63.  

Benchmarked against NIFTY Smallcap 250 TRI, the fund has given 25.17 per cent annualised return since its debut in August 2019.

At an expense ratio of 0.36 per cent, the fund has Rs 500 as the minimum SIP investment and Rs 510 as the minimum lump sum investment. 

A Rs 2,00,000 one-time investment in the fund has jumped to Rs 3,80,587 in the 3-year time frame.

ICICI Prudential Nifty Smallcap 250 Index Fund Direct – Growth

The fund has given a 23.80 per cent annualised SIP return in 3 years.

Its AUM is Rs 450 crore, while its NAV as on May 16, 2025, was Rs 16.81.  

Benchmarked against NIFTY Smallcap 250 TRI, the fund has given 15.77 per cent annualised return since its starting in October 2014.

With an expense ratio of 0.33 per cent, the fund has Rs 105 as the minimum SIP and lump sum investment each. 

A Rs 2,00,000 one-time investment in the fund has grown to Rs 3,79,483 in 3 years.

Nippon India Nifty Smallcap 250 Index Fund Direct – Growth

The fund has given 23.52 per cent annualised SIP return in 10 years.

It has AUM of Rs 2,033 crore, while its NAV as on May 16, 2025, was Rs 32.44.  

Benchmarked against BSE India Infrastructure TRI, the fund has given 29.21 per cent annualised return since its debut in January 2013.

At an expense ratio of 0.35 per cent, the fund has Rs 105 as the minimum SIP investment and lump sum investment each. 

A Rs 2,00,000 one-time investment in the fund has jumped to Rs 3,76,914 in the 3-year period.