Top International funds returned up to 203% in a year. Can you still invest?

International mutual funds have quietly emerged as some of the best-performing schemes available to Indian investors over the past year. While domestic equity funds have benefited from a strong market environment, the biggest gains among overseas-focused schemes came from a handful of markets in Asia.

The standout performer was the Nippon India Taiwan Equity Fund, which delivered a one-year return of 202.9%. That means an investment of ₹1 lakh would have grown to more than ₹3 lakh over the period. Several other international funds also generated returns well above those seen in many traditional equity fund categories.

However, there is a catch. Many international mutual funds remain closed to fresh investments or continue to operate under restrictions, making it difficult for investors to access some of the category's strongest performers.

The performance gap between the top international funds and the rest of the category was striking.

Nippon India Taiwan Equity Fund led the pack with a one-year return of 202.9% and assets under management (AUM) of ₹1,256 crore. The next best performer was Franklin Asian Equity Fund, which generated a return of 55.5%. Nippon India Japan Equity Fund followed with a gain of 37%, while Aditya Birla Sun Life International Equity Fund returned 31.9%.

Among larger and more widely held international schemes, returns were relatively modest. ICICI Prudential US Bluechip Equity Fund, the largest fund in the list with an AUM of ₹3,699 crore, delivered 18.9%, while Nippon India US Equity Opportunities Fund generated 16.1%.

The rankings also reveal a shift in where returns came from over the past year.

For much of the past decade, US equities have been the preferred route for Indian investors seeking international diversification. As a result, many of the largest international mutual funds in India are focused on US stocks.

Franklin Asian Equity Fund's 55.5% return was nearly three times the 18.9% delivered by ICICI Prudential US Bluechip Equity Fund. Nippon India Japan Equity Fund generated 37%, compared with 16.1% from Nippon India US Equity Opportunities Fund.

The strongest-performing funds were concentrated in Taiwan, Japan and broader Asian markets rather than the US. This suggests that investors who diversified across regions rather than concentrating solely on US equities saw significantly higher gains over the period.

Despite the impressive returns, investors looking to invest in these funds today may find their options limited. Several international mutual funds have either stopped accepting fresh investments or imposed restrictions on inflows. However, a limited number of international funds continue to accept fresh SIP investments.

These include Franklin Asian Equity Fund, Franklin U.S. Opportunities Equity Active FoF, PGIM India Global Equity Opportunities FoF, PGIM India Emerging Markets Equity FoF and Baroda BNP Paribas Aqua FoF.

Notably, Edelweiss Emerging Markets Opportunities Equity Offshore Fund delivered a one-year return of 75,87%, making it one of the strongest performers among the funds that remain accessible to investors. Franklin Asian Equity Fund, which returned 54.1%, also continues to accept SIP inflows, subject to limits.

The past year has demonstrated the potential role of international funds in diversifying portfolios beyond India. Some overseas-focused schemes generated returns that significantly outpaced many domestic equity categories, driven largely by gains in Taiwan, Japan and other Asian markets.

At the same time, the category presents a challenge that investors do not typically face with domestic mutual funds. The highest-returning schemes are not always available for fresh investments, and the number of international funds still accepting money remains limited.