Investment Planning for FY26: Mutual Fund Expert Tips for Smart Investors

The new financial year is about to start and the people who want to invest are looking for investment opportunities.  The mutual fund advisors or experts suggest that the investors should proceed carefully with a long-term strategy given the uncertainties ahead in FY26. For the investors who have Low risk tolerance should aim for debt funds, while investors who are ready to manage volatility can opt for equity as an asset class.

“In FY 26 Investors are advised to consider disciplined investing, Coordinating portfolios with long-term goals and performing annual rebalancing when needed. For the investors who are new or investing for the first time, the first step should be to determine your goals and investment horizon. Recognise your objectives of risk and returns, and after that, select an appropriate asset allocation strategy that matches your risk and return appetite. A mixture of equity and debt in the right proportions would be right because they have less correlation with each other and provide the benefits of portfolio diversification,” recommended by an expert.

Another expert added, “If one investor had a long investment perspective, then an asset allocation of 80:20 in equity to debt would be appropriate. The investor who has a medium-term can be 70:30 and if one has a short investment, the most suitable option will be 100% allotted to debt. For the people who are already investing, it is mandatory to reevaluate their asset allocation strategy. Corrections in the Market may have caused misalignment, which makes the rebalancing necessary. Investors should review where they would redirect funds to maintain the right balance while evaluating the tax implications of existing different investments.”

As of now, in the financial year 2025, an average of 17% returns were offered by the category of equity mutual funds.  Healthcare and pharma funds lead the chart with an average return of 17.43% in FY25 to date. Subsequently, international funds offered a return of 10.77% during the same period of time.

In FY25 so far, mid-cap, small-cap, and large-cap funds have given single-digit returns. Mid-cap funds returned about 8.56%, small-cap funds 6.49%, and large-cap funds 4.76% on average.