Add to Cart
Invest at 0% Commission in 1,500+ Direct Mutual Fund Schemes
Contra Mutual Funds
3 Year Average Returns
13.36%
Funds on Dhan
6
Contra Funds are a type of Equity Funds that invest in stocks that are currently out of favor or undervalued by the market. These Funds follow a contrarian strategy of buying low and selling high. While these are the best Contra Mutual Funds to invest in, you must know these 3 things before you start investing.
- Goal: Contra Funds go against the market grain, investing in stocks currently out of favor but with potential for a comeback.
- Investment Horizon: Best suited for investors who can afford to wait 7 years or more.
- Risk: This contrarian approach carries higher risk, as it relies on market mispricing.
Best Contra Funds to Invest in 2026
Note: 3Y & 5Y returns are annualised. Rest everything is absolute.
Scheme | AUM (in Cr.) | Fund Age | 1W | 1M | 3M | 6M | 1Y | 3Y  | 5Y |
|---|---|---|---|---|---|---|---|---|---|
Compare | ₹ 19,248 | 13 Yrs | 3.70% | 3.87% | -3.11% | 3.39% | -2.77% | 14.88% | 12.15% |
Compare | ₹ 5,196 | 13 Yrs | 4.15% | 1.87% | -4.91% | -0.55% | -3.36% | 14.46% | 13.18% |
Compare | ₹ 45,068 | 13 Yrs | 3.14% | 2.06% | -4.95% | -1.65% | -6.49% | 10.74% | 13.49% |
Compare | ₹ 0 | 0 Yrs | 2.54% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% |
Compare | ₹ 1,712 | 0 Yrs | 4.73% | 4.05% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% |
Compare | ₹ 407 | 0 Yrs | 2.97% | 3.08% | -0.19% | 0.00% | 0.00% | 0.00% | 0.00% |
Returns Calculator
Based on Annualised Returns
Investment Type
SIP Amount
Check the Returns of Your Investment in
Check the Returns of Your Investment in
Total Investment
₹ NaN
Returns
₹ 0
(-%)
Maturity Value after -
₹ 0
Disclaimer: Mutual fund investments carry market risks; read all scheme-related documents carefully. Past performance does not guarantee future returns.
About Contra Funds
A Contra Mutual Fund undertakes a contrarian investment strategy. Fund managers select stocks that are against market trends and search for undervalued stocks. Here are a few features that define Contra Funds:
- The major differentiating element of contra funds is contrarian investing. Fund managers search for opportunities in companies or industries that the market has neglected or that are temporarily undervalued or at discounted prices.
- Contra Funds can help you maintain a diverse portfolio. Diversification limits the negative impact of a single investment and spreads risk.
- Effective market timing is often required for successful contrarian investing. Fund managers need to determine when specific stocks are undervalued or when a shift in mood is likely to occur in the market cycle.
Investing in Contra Funds can benefit you in several ways, especially if you feel comfortable using a contrarian investment approach. Here are a few benefits of making investments in Contra Funds:
- You can expect decent returns when investing in Contra Funds. The investments done by contra funds are still not at their true values. So, if a turnaround occurs, they might perform incredibly well and can give you substantial returns.
- Contra fund managers are free to change the asset allocation of the fund as per the market conditions. This flexibility allows them to avoid potentially expensive market sectors and to capitalize on new opportunities.
- Since the fund invests in stocks after careful consideration, it eliminates the effort on your end for stock selection.
To help you decide if Contra Funds are right for you, keep the following considerations in mind:
- To determine whether to invest in Contra Funds, you need to consider some factors, such as your investment strategy, risk tolerance, and financial objectives. Selecting a reputable Contra Fund with an experienced management team is important.
- Contra Funds are considered riskier investments compared to other safe options like Large Cap funds and debt instruments. They have a higher level of volatility since they contradict conventional market practices. Determine your risk tolerance and determine that you are prepared to handle any potential volatility in the value of contra funds.
- Consider your investing horizon or how long you intend to stay invested in this fund. A longer-term perspective may be necessary for contrarian strategies since the chosen stocks may need some time to recover and perform.
Here are the considerations you should make while making an investment in Contra Funds:
- The performance of Contra Funds is directly related to the stock selections by the fund managers. You need to have a higher risk appetite for investing in these funds.
- If you have a long-term investment horizon, then only you should consider adding Contra Funds to your portfolios. Contra Funds select underperforming equities with untapped potential, and thus you require patience.
- Market sentiment can be difficult to predict, and contrarian strategies may not necessarily result in positive outcomes in the short run. So, you need to be prepared for such market uncertainties too. Contra Funds may not suit you if you are looking for safe investments.
Open NFOs
Sorry, No Data Available at this Moment!
FAQs
Contra funds are funds that invest against the trends of the market, with particular focus on companies that are presently underperforming but have a significant potential for recovery. These funds look for chances in stocks or sectors that are undervalued or not in favor, with the expectation that they will eventually make a return.
The purpose of these funds is to achieve diversity while concentrating on undervalued assets. They invest in large, mid, and small-cap companies as well as stocks from a variety of other industries. Because of this approach, they are able to capitalize on potential growth throughout the whole range of the market.
Contra Funds have the potential to generate attractive returns by investing in undervalued stocks poised for a rebound. However, their success depends on the fund manager's ability to accurately pick such stocks and the market's recognition of their true value over time.
Contra Funds are not exempt from paying taxes. They are subject to capital gains tax, much like other equity mutual funds, with the rate of taxation of the capital gains tax varying according to the period of time the investment has been held.
Short-term capital gains, which are profits on investments held for less than a year, are subject to a tax rate of 15%. On the other hand, long-term capital gains, which are gains on investments held for more than a year, are exempt from taxation up to a maximum of ₹1 lakh. The tax rate for any profits that are more than ₹1 lakh is 10%.
For the purpose of choosing the best Contra Fund, it is necessary to consider the investing strategy, management team, and performance history of the fund. Because Contra Funds usually demand a long-term commitment for the greatest possibility of success, it's crucial to evaluate your individual risk tolerance and investing horizon.
Contra Funds do not need you to have a demat account in order to invest in them. Without the need for a demat account, you may purchase these funds directly via the website of a mutual fund or through an investing platform that specializes in mutual funds. This will make the procedure easier for you.
In Contra Funds, your investment plan and goals will help you decide whether to make a lump sum or a SIP (Systematic Investment Plan). SIPs allow for disciplined investing over time, potentially averaging out the cost. Lump Sum may suit if you have a significant sum to invest at once, particularly in a market downturn when undervalued stocks may be more prevalent.
To start an Contra Fund SIP online, follow these 4 steps:
- Open Demat Account
- Choose the Contra Fund you wish to invest in.
- Choose the SIP option, specifying the amount and SIP date
- Set up an auto-pay via bank account to automate the SIP payments
The answer is yes; you are free to sell or redeem your Contra Fund assets whenever you choose. Nevertheless, taking into account the contrarian and long-term attitude that these funds use, it can be advantageous to keep your investment for an extended period of time in order to acquire the potential for benefits.
There is often no lock-in term associated with Contra Funds, which means that you have the opportunity to redeem your investment whenever you see fit. Because of this function, you will be able to manage your investment in accordance with your financial goals and the current market circumstances.
Contra Funds, by nature, invest in stocks or sectors that are currently out of favor and may carry higher risk, especially in the short term, due to their contrarian approach. The success of these funds depends on the fund manager's ability to pick undervalued stocks that will eventually perform well, making them subject to market risk and volatility.
Even Contra Funds are not completely risk-free investments. While they offer the potential for high returns by investing in undervalued stocks, they also come with the risk of underperformance if the market does not turn in favor of the selected stocks or sectors. It's essential to align such investments with your risk tolerance and financial goals.
Invest in
Contra Mutual Funds
Pay 0% Commission!
+91
error
Or Scan the QR Code to download the Dhan App
