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Best Long Term Investment Options

Updated on August 27, 2025 , 8011 views

Planning for a long term investment? But, how? Most investors look for the ‘best instrument’ to safeguard their hard earned money. But, before you invest, understanding the importance of the right investment is very significant. So, here is a list of some the best long term investment options with their investment purpose.

best-long-term-options

Top Long Term Investment Options in India

1. Public Provident Fund or PPF

Public Provident Fund (PPF) is one of the most popular long term investment options in India. Since it's backed by the Government of India, it is a safe investment with an attractive interest rate. Moreover, it offers tax benefits under Section 80C, of income tax 1961, and also the interest income is exempted from tax.

PPF comes with a maturity period of 15 years, however, it can be extended within a year of maturity for five years and more. Annual deposits of minimum INR 500 to maximum INR 1.5 lakh can be invested in PPF account.

2. Mutual Funds

A mutual fund is one of the best long term investment options in India. A Mutual Fund is a collective pool of money with a common objective for purchasing securities (via the fund). Mutual Funds are regulated by the Securities and Exchange Board of India (SEBI) and are managed by Asset Management Companies (AMC’s). Mutual Funds have gained immense popularity amongst investors over the past few years.

There are various Types of Mutual Funds like Equity Funds, Debt fund, Money market funds, Hybrid Fund and gold funds. Each has its own investment objective. However, people who look to balance risk and return, generally prefer to invest in equity and bond Mutual Funds.

The Systematic Investment plan (SIP) is also considered to be one of the best long term investment options to invest in a Mutual Fund. SIPs make an excellent tool for Investing hard earned money, especially for those earning salaries. There are various SIP calculators available in the market that try to help investors make investment plans.

Some of the best mutual funds to invest in India having Assets more than 300 Crore and having best CAGR returns for last 5 years are :

FundNAVNet Assets (Cr)3 MO (%)6 MO (%)1 YR (%)3 YR (%)5 YR (%)2024 (%)
ICICI Prudential Infrastructure Fund Growth ₹189.27
↓ -0.79
₹7,941-2.215.7-3283327.4
Motilal Oswal Midcap 30 Fund  Growth ₹101.99
↓ -0.51
₹33,6091.9150.128.132.257.1
Nippon India Small Cap Fund Growth ₹164.4
↓ -0.52
₹65,922-0.617.9-7.9233126.1
Bandhan Infrastructure Fund Growth ₹48.543
↓ -0.14
₹1,676-4.419.1-12.725.930.939.3
HDFC Infrastructure Fund Growth ₹46.343
↓ -0.12
₹2,540-2.317-5.827.430.723
DSP India T.I.G.E.R Fund Growth ₹305.411
↓ -0.83
₹5,406-1.118-9.825.630.532.4
Franklin Build India Fund Growth ₹137.689
↓ -0.46
₹2,950-0.716.8-5.227.130.427.8
Canara Robeco Infrastructure Growth ₹156.87
↑ 0.24
₹917-1.121-4.123.729.735.3
LIC MF Infrastructure Fund Growth ₹47.4285
↓ -0.10
₹1,038-3.921.9-8.526.129.247.8
HDFC Small Cap Fund Growth ₹139.273
↓ -0.17
₹36,3533.222.4-12328.920.4
Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 29 Aug 25

Research Highlights & Commentary of 10 Funds showcased

CommentaryICICI Prudential Infrastructure FundMotilal Oswal Midcap 30 Fund Nippon India Small Cap FundBandhan Infrastructure FundHDFC Infrastructure FundDSP India T.I.G.E.R FundFranklin Build India FundCanara Robeco InfrastructureLIC MF Infrastructure FundHDFC Small Cap Fund
Point 1Upper mid AUM (₹7,941 Cr).Upper mid AUM (₹33,609 Cr).Highest AUM (₹65,922 Cr).Bottom quartile AUM (₹1,676 Cr).Lower mid AUM (₹2,540 Cr).Upper mid AUM (₹5,406 Cr).Lower mid AUM (₹2,950 Cr).Bottom quartile AUM (₹917 Cr).Bottom quartile AUM (₹1,038 Cr).Top quartile AUM (₹36,353 Cr).
Point 2Established history (20+ yrs).Established history (11+ yrs).Established history (14+ yrs).Established history (14+ yrs).Established history (17+ yrs).Oldest track record among peers (21 yrs).Established history (15+ yrs).Established history (19+ yrs).Established history (17+ yrs).Established history (17+ yrs).
Point 3Rating: 3★ (lower mid).Rating: 3★ (lower mid).Rating: 4★ (upper mid).Top rated.Rating: 3★ (bottom quartile).Rating: 4★ (upper mid).Rating: 5★ (top quartile).Not Rated.Not Rated.Rating: 4★ (upper mid).
Point 4Risk profile: High.Risk profile: Moderately High.Risk profile: Moderately High.Risk profile: High.Risk profile: High.Risk profile: High.Risk profile: High.Risk profile: High.Risk profile: High.Risk profile: Moderately High.
Point 55Y return: 33.02% (top quartile).5Y return: 32.15% (top quartile).5Y return: 31.05% (upper mid).5Y return: 30.90% (upper mid).5Y return: 30.69% (upper mid).5Y return: 30.53% (lower mid).5Y return: 30.36% (lower mid).5Y return: 29.71% (bottom quartile).5Y return: 29.24% (bottom quartile).5Y return: 28.86% (bottom quartile).
Point 63Y return: 28.04% (top quartile).3Y return: 28.09% (top quartile).3Y return: 22.96% (bottom quartile).3Y return: 25.93% (lower mid).3Y return: 27.37% (upper mid).3Y return: 25.63% (lower mid).3Y return: 27.14% (upper mid).3Y return: 23.74% (bottom quartile).3Y return: 26.14% (upper mid).3Y return: 22.95% (bottom quartile).
Point 71Y return: -3.01% (upper mid).1Y return: 0.15% (top quartile).1Y return: -7.92% (lower mid).1Y return: -12.67% (bottom quartile).1Y return: -5.80% (lower mid).1Y return: -9.79% (bottom quartile).1Y return: -5.24% (upper mid).1Y return: -4.14% (upper mid).1Y return: -8.54% (bottom quartile).1Y return: -0.95% (top quartile).
Point 8Alpha: 0.00 (upper mid).Alpha: 3.70 (top quartile).Alpha: -3.84 (bottom quartile).Alpha: 0.00 (upper mid).Alpha: 0.00 (upper mid).Alpha: 0.00 (lower mid).Alpha: 0.00 (lower mid).Alpha: 0.00 (bottom quartile).Alpha: 1.35 (top quartile).Alpha: 0.00 (bottom quartile).
Point 9Sharpe: -0.42 (upper mid).Sharpe: -0.11 (top quartile).Sharpe: -0.51 (lower mid).Sharpe: -0.69 (bottom quartile).Sharpe: -0.56 (bottom quartile).Sharpe: -0.65 (bottom quartile).Sharpe: -0.51 (lower mid).Sharpe: -0.36 (upper mid).Sharpe: -0.30 (upper mid).Sharpe: -0.17 (top quartile).
Point 10Information ratio: 0.00 (upper mid).Information ratio: 0.44 (top quartile).Information ratio: 0.00 (upper mid).Information ratio: 0.00 (upper mid).Information ratio: 0.00 (lower mid).Information ratio: 0.00 (lower mid).Information ratio: 0.00 (bottom quartile).Information ratio: 0.00 (bottom quartile).Information ratio: 0.40 (top quartile).Information ratio: 0.00 (bottom quartile).

ICICI Prudential Infrastructure Fund

  • Upper mid AUM (₹7,941 Cr).
  • Established history (20+ yrs).
  • Rating: 3★ (lower mid).
  • Risk profile: High.
  • 5Y return: 33.02% (top quartile).
  • 3Y return: 28.04% (top quartile).
  • 1Y return: -3.01% (upper mid).
  • Alpha: 0.00 (upper mid).
  • Sharpe: -0.42 (upper mid).
  • Information ratio: 0.00 (upper mid).

Motilal Oswal Midcap 30 Fund 

  • Upper mid AUM (₹33,609 Cr).
  • Established history (11+ yrs).
  • Rating: 3★ (lower mid).
  • Risk profile: Moderately High.
  • 5Y return: 32.15% (top quartile).
  • 3Y return: 28.09% (top quartile).
  • 1Y return: 0.15% (top quartile).
  • Alpha: 3.70 (top quartile).
  • Sharpe: -0.11 (top quartile).
  • Information ratio: 0.44 (top quartile).

Nippon India Small Cap Fund

  • Highest AUM (₹65,922 Cr).
  • Established history (14+ yrs).
  • Rating: 4★ (upper mid).
  • Risk profile: Moderately High.
  • 5Y return: 31.05% (upper mid).
  • 3Y return: 22.96% (bottom quartile).
  • 1Y return: -7.92% (lower mid).
  • Alpha: -3.84 (bottom quartile).
  • Sharpe: -0.51 (lower mid).
  • Information ratio: 0.00 (upper mid).

Bandhan Infrastructure Fund

  • Bottom quartile AUM (₹1,676 Cr).
  • Established history (14+ yrs).
  • Top rated.
  • Risk profile: High.
  • 5Y return: 30.90% (upper mid).
  • 3Y return: 25.93% (lower mid).
  • 1Y return: -12.67% (bottom quartile).
  • Alpha: 0.00 (upper mid).
  • Sharpe: -0.69 (bottom quartile).
  • Information ratio: 0.00 (upper mid).

HDFC Infrastructure Fund

  • Lower mid AUM (₹2,540 Cr).
  • Established history (17+ yrs).
  • Rating: 3★ (bottom quartile).
  • Risk profile: High.
  • 5Y return: 30.69% (upper mid).
  • 3Y return: 27.37% (upper mid).
  • 1Y return: -5.80% (lower mid).
  • Alpha: 0.00 (upper mid).
  • Sharpe: -0.56 (bottom quartile).
  • Information ratio: 0.00 (lower mid).

DSP India T.I.G.E.R Fund

  • Upper mid AUM (₹5,406 Cr).
  • Oldest track record among peers (21 yrs).
  • Rating: 4★ (upper mid).
  • Risk profile: High.
  • 5Y return: 30.53% (lower mid).
  • 3Y return: 25.63% (lower mid).
  • 1Y return: -9.79% (bottom quartile).
  • Alpha: 0.00 (lower mid).
  • Sharpe: -0.65 (bottom quartile).
  • Information ratio: 0.00 (lower mid).

Franklin Build India Fund

  • Lower mid AUM (₹2,950 Cr).
  • Established history (15+ yrs).
  • Rating: 5★ (top quartile).
  • Risk profile: High.
  • 5Y return: 30.36% (lower mid).
  • 3Y return: 27.14% (upper mid).
  • 1Y return: -5.24% (upper mid).
  • Alpha: 0.00 (lower mid).
  • Sharpe: -0.51 (lower mid).
  • Information ratio: 0.00 (bottom quartile).

Canara Robeco Infrastructure

  • Bottom quartile AUM (₹917 Cr).
  • Established history (19+ yrs).
  • Not Rated.
  • Risk profile: High.
  • 5Y return: 29.71% (bottom quartile).
  • 3Y return: 23.74% (bottom quartile).
  • 1Y return: -4.14% (upper mid).
  • Alpha: 0.00 (bottom quartile).
  • Sharpe: -0.36 (upper mid).
  • Information ratio: 0.00 (bottom quartile).

LIC MF Infrastructure Fund

  • Bottom quartile AUM (₹1,038 Cr).
  • Established history (17+ yrs).
  • Not Rated.
  • Risk profile: High.
  • 5Y return: 29.24% (bottom quartile).
  • 3Y return: 26.14% (upper mid).
  • 1Y return: -8.54% (bottom quartile).
  • Alpha: 1.35 (top quartile).
  • Sharpe: -0.30 (upper mid).
  • Information ratio: 0.40 (top quartile).

HDFC Small Cap Fund

  • Top quartile AUM (₹36,353 Cr).
  • Established history (17+ yrs).
  • Rating: 4★ (upper mid).
  • Risk profile: Moderately High.
  • 5Y return: 28.86% (bottom quartile).
  • 3Y return: 22.95% (bottom quartile).
  • 1Y return: -0.95% (top quartile).
  • Alpha: 0.00 (bottom quartile).
  • Sharpe: -0.17 (top quartile).
  • Information ratio: 0.00 (bottom quartile).

3. Post Office Savings Schemes

Post Office Saving Schemes are considered to be one of the best long term investment options for government employees, salaried class and businessmen. They offer a moderate rate of interest and tax benefits under section 80C of Income Tax Act as well.

Some of the most popular Post Office Saving Schemes are as follows-

4. Bonds

Bonds are a part of long term investment options. A bond is an investing instrument used to borrow money. It’s a long-term debt instrument, used by the companies to raise Capital from the public. In return, bonds offer a fixed interest rate on investment. The principle amount is paid back to the investor at the maturity period.

So, investing in long-term bonds is considered as a good alternative for earning decent returns on your investment.

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5. Fixed Deposit (FD)

Fixed deposit is a good to go as one of the best long term investment options as it is considered to be the easiest and common instrument. It is yet another option for risk-free investment. Investors can invest any amount in an FD for a maximum period of 10 years. But, the interest varies depending on the amount of investment and also the tenure.

6. Gold

Indian investors often look for Investing in Gold and it's also one of the good long term investment options. Gold is used as an Inflation hedge. Investing in gold can be done via buying physical gold, gold deposit scheme, gold ETF, Gold Bar or gold Mutual Fund. Some of the best underlying Gold ETFs in India are as follows:

FundNAVNet Assets (Cr)3 MO (%)6 MO (%)1 YR (%)3 YR (%)5 YR (%)2024 (%)
SBI Gold Fund Growth ₹30.0749
↑ 0.32
₹4,7407.719.540.324.713.419.6
IDBI Gold Fund Growth ₹26.7506
↑ 0.37
₹2147.519.540.324.613.618.7
Aditya Birla Sun Life Gold Fund Growth ₹29.9113
↑ 0.30
₹6637.919.840.324.513.418.7
Axis Gold Fund Growth ₹29.9607
↑ 0.36
₹1,1807.719.739.924.513.519.2
HDFC Gold Fund Growth ₹30.7365
↑ 0.33
₹4,5377.72040.224.413.318.9
Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 29 Aug 25

Research Highlights & Commentary of 5 Funds showcased

CommentarySBI Gold FundIDBI Gold FundAditya Birla Sun Life Gold FundAxis Gold FundHDFC Gold Fund
Point 1Highest AUM (₹4,740 Cr).Bottom quartile AUM (₹214 Cr).Bottom quartile AUM (₹663 Cr).Lower mid AUM (₹1,180 Cr).Upper mid AUM (₹4,537 Cr).
Point 2Oldest track record among peers (13 yrs).Established history (13+ yrs).Established history (13+ yrs).Established history (13+ yrs).Established history (13+ yrs).
Point 3Rating: 2★ (upper mid).Not Rated.Top rated.Rating: 1★ (lower mid).Rating: 1★ (bottom quartile).
Point 4Risk profile: Moderately High.Risk profile: Moderately High.Risk profile: Moderately High.Risk profile: Moderately High.Risk profile: Moderately High.
Point 55Y return: 13.45% (lower mid).5Y return: 13.58% (top quartile).5Y return: 13.43% (bottom quartile).5Y return: 13.54% (upper mid).5Y return: 13.30% (bottom quartile).
Point 63Y return: 24.72% (top quartile).3Y return: 24.63% (upper mid).3Y return: 24.50% (lower mid).3Y return: 24.48% (bottom quartile).3Y return: 24.43% (bottom quartile).
Point 71Y return: 40.32% (top quartile).1Y return: 40.30% (lower mid).1Y return: 40.32% (upper mid).1Y return: 39.85% (bottom quartile).1Y return: 40.22% (bottom quartile).
Point 81M return: 4.16% (lower mid).1M return: 4.15% (bottom quartile).1M return: 4.25% (top quartile).1M return: 4.17% (upper mid).1M return: 4.14% (bottom quartile).
Point 9Alpha: 0.00 (top quartile).Alpha: 0.00 (upper mid).Alpha: 0.00 (lower mid).Alpha: 0.00 (bottom quartile).Alpha: 0.00 (bottom quartile).
Point 10Sharpe: 2.53 (upper mid).Sharpe: 2.25 (bottom quartile).Sharpe: 2.62 (top quartile).Sharpe: 2.50 (lower mid).Sharpe: 2.50 (bottom quartile).

SBI Gold Fund

  • Highest AUM (₹4,740 Cr).
  • Oldest track record among peers (13 yrs).
  • Rating: 2★ (upper mid).
  • Risk profile: Moderately High.
  • 5Y return: 13.45% (lower mid).
  • 3Y return: 24.72% (top quartile).
  • 1Y return: 40.32% (top quartile).
  • 1M return: 4.16% (lower mid).
  • Alpha: 0.00 (top quartile).
  • Sharpe: 2.53 (upper mid).

IDBI Gold Fund

  • Bottom quartile AUM (₹214 Cr).
  • Established history (13+ yrs).
  • Not Rated.
  • Risk profile: Moderately High.
  • 5Y return: 13.58% (top quartile).
  • 3Y return: 24.63% (upper mid).
  • 1Y return: 40.30% (lower mid).
  • 1M return: 4.15% (bottom quartile).
  • Alpha: 0.00 (upper mid).
  • Sharpe: 2.25 (bottom quartile).

Aditya Birla Sun Life Gold Fund

  • Bottom quartile AUM (₹663 Cr).
  • Established history (13+ yrs).
  • Top rated.
  • Risk profile: Moderately High.
  • 5Y return: 13.43% (bottom quartile).
  • 3Y return: 24.50% (lower mid).
  • 1Y return: 40.32% (upper mid).
  • 1M return: 4.25% (top quartile).
  • Alpha: 0.00 (lower mid).
  • Sharpe: 2.62 (top quartile).

Axis Gold Fund

  • Lower mid AUM (₹1,180 Cr).
  • Established history (13+ yrs).
  • Rating: 1★ (lower mid).
  • Risk profile: Moderately High.
  • 5Y return: 13.54% (upper mid).
  • 3Y return: 24.48% (bottom quartile).
  • 1Y return: 39.85% (bottom quartile).
  • 1M return: 4.17% (upper mid).
  • Alpha: 0.00 (bottom quartile).
  • Sharpe: 2.50 (lower mid).

HDFC Gold Fund

  • Upper mid AUM (₹4,537 Cr).
  • Established history (13+ yrs).
  • Rating: 1★ (bottom quartile).
  • Risk profile: Moderately High.
  • 5Y return: 13.30% (bottom quartile).
  • 3Y return: 24.43% (bottom quartile).
  • 1Y return: 40.22% (bottom quartile).
  • 1M return: 4.14% (bottom quartile).
  • Alpha: 0.00 (bottom quartile).
  • Sharpe: 2.50 (bottom quartile).

Whether it's buying a house, gold, car or any asset, investing is an important decision of life and also a necessity. While, each long term investment option has its own benefits and risks, plan and explore the best investment options as mentioned above and enhance your financial security.

Conclusion

Keep focused Financial goals and also remember while choosing best long term investment options you have to plan for a diversified investment strategy. This will minimise your risks. So, start investing a good part of your Earnings in long term investment plans!

One looking for Long Term investments in various asset classes as described above. Illustration with timeframe:

Horizon Asset Class Risk
> 10 Years Equity Mutual Funds High
> 5 Years Equity Mutual Funds High
3 - 5 Years Bonds/Gold/FD/Debt Mutual Funds Low
2 -3 Years Bonds/Gold/Debt Mutual Funds Low
1 - 2 Year Ultra Short Debt Mutual Funds/ FD Low
< 1 Year Ultra Short/Liquid Debt Mutual Funds / FD Low

Best-Long-Term-Investment-Plans

Disclaimer:
All efforts have been made to ensure the information provided here is accurate. However, no guarantees are made regarding correctness of data. Please verify with scheme information document before making any investment.
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J.T.Thorat , posted on 19 Nov 22 10:23 PM

Best information, Thanks

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