FoFs are a commonly used term for Funds for Funds. It is a type of mutual fund that generates returns by investing in other mutual funds, allowing you to enjoy the benefits of different well-performing mutual funds through a single fund. A Fund of Funds (FOF) Domestic Mutual Fund invests exclusively in Domestic Mutual Funds rather than directly buying stocks or bonds. FOF Mutual Funds generally appeal to investors seeking diversification, professional management, and tailored goals, whether it’s capital appreciation, income generation, or a blend. By holding a basket of funds, Domestic FOFs streamline portfolio construction, mitigate individual fund volatility, and offer a convenient way to participate in domestic market opportunities.
1. Smart Investing Strategy: A key Domestic Mutual Fund Feature is its structure. These funds don’t invest in stocks or bonds directly. Instead, they invest in a carefully selected mix of domestic mutual funds, giving you exposure to a range of strategies through one investment.
2. Moderate Risk Profile: Domestic FOF Mutual Funds often combine both equity and debt-oriented schemes. This mix helps balance growth potential with stability, making it a suitable option for investors seeking moderate risk.
3. Expense Ratio Efficiency: Thanks to economies of scale, another Domestic Mutual Fund Feature is lower overall costs. These funds often offer competitive total expense ratios compared to investing in multiple standalone funds.
4. High Liquidity: Like regular mutual funds, Domestic FOFs offer daily liquidity. This means you can buy or sell units easily without dealing with any complex procedures.
Who Should Invest in FOF Domestic Mutual Funds?
1. New Investors Exploring Diversification: If you're starting your Domestic Mutual Fund Investment journey and want broad exposure, FOFs offer an easy way to diversify across asset types.
2. Investors with Limited Capital: Those with smaller investment amounts can still gain access to multiple mutual funds by choosing to invest in FOF Mutual Fund options.
3. Moderate Risk Takers: Funds of Funds in India are ideal for investors comfortable with medium risk, balancing growth and stability through equity and debt fund exposure.
4. Those Seeking Simpler Fund Management: Instead of tracking multiple funds, FOFs allow you to manage a single investment while still enjoying the benefits of a diversified portfolio.
What are the Advantages of Investing FOF Domestic Funds?
1. Potential for Higher Returns: One key Domestic Mutual Fund Benefit is the chance to earn better returns by combining high-performing mutual funds within a single portfolio.
2. Access to New Markets: By investing in multiple domestic mutual funds, FOFs offer exposure to different sectors and strategies that may not be available in individual schemes.
3. Built-in Diversification: A major Domestic Mutual Fund Benefit is diversification. Your money is spread across equity and debt funds, reducing overall investment risk.
How to Invest in FOF Domestic Mutual Funds?
1. Visit 5paisa: Go to the 5paisa website to begin your Domestic Mutual Fund Investment journey.
2. Create or Log in to Your Account: Sign up or log in easily using your mobile number or email ID.
3. Search for FOF Mutual Funds: Explore top-performing Funds of Fund in India through the simple search feature on 5paisa.
4. Compare and Choose a Fund: Check returns, risk level, and fund details to confidently invest in FOF Mutual Fund schemes.
5. Invest and Track with Ease: Enter the amount, confirm, and track your investments anytime through your 5paisa app. With 5paisa’s smooth interface and quick setup, investing in mutual funds has never been easier!
Factors to Consider While Investing in FOF Domestic Funds
1. Investment Objective: Before making a Domestic Mutual Fund Investment, define your financial goals, whether it’s wealth creation, diversification or steady income.
2. Risk Tolerance: Funds of Fund in India come with moderate risk. Make sure your comfort with market ups and downs aligns with the fund’s profile.
3. Investment Horizon: If you're planning to stay invested for the medium to long term, FOFs can be a good choice to balance risk and reward.
4. Fund Strategy and Holdings: Understand where the fund invests. To wisely invest in FOF Mutual Fund options, review the mix of equity and debt in its portfolio.
5. Costs and Charges: Look out for expense ratios. Some Domestic Mutual Fund Benefits may come at a slightly higher cost due to layered fees.
Taxability of FOF Domestic Mutual Funds
As per the revised tax regulations effective from April 1, 2023, Funds of Fund in India are classified as non-equity funds, regardless of their underlying equity exposure. As a result, gains from Domestic Mutual Fund investments in FOFs are treated as part of the investor’s total income and taxed according to their applicable income tax slab.
Risks Involved with FOF Domestic Funds
1. Potential for Overlapping Assets: One drawback of Funds of Funds in India is excessive diversification. Since these funds invest in multiple mutual funds, there's a chance they may hold similar assets across schemes. This overlap can reduce the effectiveness of diversification, even if the portfolio appears well spread.
2. Market Risk: Despite their diversified nature, Domestic Mutual Fund Investments through FOFs are still exposed to market volatility. The performance of underlying funds, especially equity-oriented ones, can fluctuate due to economic conditions or sector-specific trends.
3. Manager Risk: A key factor in FOF success is the expertise of the fund manager. If the manager fails to choose high-quality underlying mutual funds or manage the allocation effectively, it can impact overall returns and fund performance.
AXIS Silver Fund of Fund - Direct Growth is an FoFs Domestic scheme that was launched on 02-09-2022 and is currently under the management of our experienced fund manager Aditya Pagaria. With an impressive AUM of ₹1,148 Crores, this scheme's latest NAV is ₹37.0901 as of 7/31/2026 12:00:00 AM.
AXIS Silver Fund of Fund - Direct Growth scheme has delivered a return performance of 91.45% in the last 1 year, 41.41% in the last 3 years, and an since its launch. With a minimum SIP investment of just ₹ 100, this scheme offers a great investment opportunity for those looking to invest in FoFs Domestic.
UTI-Silver ETF Fund of Fund - Direct Growth is an FoFs Domestic scheme that was launched on 10-04-2023 and is currently under the management of our experienced fund manager Sharwan Kumar Goyal. With an impressive AUM of ₹588 Crores, this scheme's latest NAV is ₹27.6372 as of 7/31/2026 12:00:00 AM.
UTI-Silver ETF Fund of Fund - Direct Growth scheme has delivered a return performance of 91.60% in the last 1 year, 41.35% in the last 3 years, and an since its launch. With a minimum SIP investment of just ₹ 100, this scheme offers a great investment opportunity for those looking to invest in FoFs Domestic.
Kotak Silver ETF Fund of Fund - Direct Growth is an FoFs Domestic scheme that was launched on 13-03-2023 and is currently under the management of our experienced fund manager Jeetu Valechha Sonar. With an impressive AUM of ₹923 Crores, this scheme's latest NAV is ₹28.8678 as of 8/1/2026 12:00:00 AM.
Kotak Silver ETF Fund of Fund - Direct Growth scheme has delivered a return performance of 92.35% in the last 1 year, 41.32% in the last 3 years, and an since its launch. With a minimum SIP investment of just ₹ 100, this scheme offers a great investment opportunity for those looking to invest in FoFs Domestic.
Mirae Asset NYSE FANG+ ETF Fund of Fund - Dir Growth is an FoFs Domestic scheme that was launched on 19-04-2021 and is currently under the management of our experienced fund manager Ekta Gala. With an impressive AUM of ₹2,388 Crores, this scheme's latest NAV is ₹39.435 as of 7/31/2026 12:00:00 AM.
Mirae Asset NYSE FANG+ ETF Fund of Fund - Dir Growth scheme has delivered a return performance of 19.36% in the last 1 year, 41.26% in the last 3 years, and an since its launch. With a minimum SIP investment of just ₹ 99, this scheme offers a great investment opportunity for those looking to invest in FoFs Domestic.
ICICI Pru Silver ETF FOF - Dir Growth is an FoFs Domestic scheme that was launched on 13-01-2022 and is currently under the management of our experienced fund manager Manish Banthia. With an impressive AUM of ₹6,067 Crores, this scheme's latest NAV is ₹33.0988 as of 7/31/2026 12:00:00 AM.
ICICI Pru Silver ETF FOF - Dir Growth scheme has delivered a return performance of 91.41% in the last 1 year, 41.23% in the last 3 years, and an since its launch. With a minimum SIP investment of just ₹ 100, this scheme offers a great investment opportunity for those looking to invest in FoFs Domestic.
HDFC Silver ETF Fund of Fund - Direct Growth is an FoFs Domestic scheme that was launched on 07-10-2022 and is currently under the management of our experienced fund manager Nandita Menezes. With an impressive AUM of ₹4,327 Crores, this scheme's latest NAV is ₹35.6749 as of 7/31/2026 12:00:00 AM.
HDFC Silver ETF Fund of Fund - Direct Growth scheme has delivered a return performance of 91.56% in the last 1 year, 41.07% in the last 3 years, and an since its launch. With a minimum SIP investment of just ₹ 100, this scheme offers a great investment opportunity for those looking to invest in FoFs Domestic.
Aditya Birla SL Silver ETF FOF - Direct Growth is an FoFs Domestic scheme that was launched on 13-01-2022 and is currently under the management of our experienced fund manager Mehul Dama. With an impressive AUM of ₹1,202 Crores, this scheme's latest NAV is ₹33.5562 as of 7/31/2026 12:00:00 AM.
Aditya Birla SL Silver ETF FOF - Direct Growth scheme has delivered a return performance of 91.24% in the last 1 year, 41.03% in the last 3 years, and an since its launch. With a minimum SIP investment of just ₹ 100, this scheme offers a great investment opportunity for those looking to invest in FoFs Domestic.
Nippon India Silver ETF FOF - Direct Growth is an FoFs Domestic scheme that was launched on 13-01-2022 and is currently under the management of our experienced fund manager Jitendra Tolani. With an impressive AUM of ₹4,230 Crores, this scheme's latest NAV is ₹32.9108 as of 7/31/2026 12:00:00 AM.
Nippon India Silver ETF FOF - Direct Growth scheme has delivered a return performance of 91.14% in the last 1 year, 40.82% in the last 3 years, and an since its launch. With a minimum SIP investment of just ₹ 100, this scheme offers a great investment opportunity for those looking to invest in FoFs Domestic.
Edelweiss Gold and Silver ETF Fund of Fund-Dir Growth is an FoFs Domestic scheme that was launched on 24-08-2022 and is currently under the management of our experienced fund manager Bhavesh Jain. With an impressive AUM of ₹2,889 Crores, this scheme's latest NAV is ₹32.096 as of 7/31/2026 12:00:00 AM.
Edelweiss Gold and Silver ETF Fund of Fund-Dir Growth scheme has delivered a return performance of 69.11% in the last 1 year, 37.58% in the last 3 years, and an since its launch. With a minimum SIP investment of just ₹ 100, this scheme offers a great investment opportunity for those looking to invest in FoFs Domestic.
Motilal Oswal Gold and Silver Passive Fund of Funds-Dir Growth is an FoFs Domestic scheme that was launched on 26-09-2022 and is currently under the management of our experienced fund manager Swapnil Mayekar. With an impressive AUM of ₹2,583 Crores, this scheme's latest NAV is ₹28.9349 as of 7/31/2026 12:00:00 AM.
Motilal Oswal Gold and Silver Passive Fund of Funds-Dir Growth scheme has delivered a return performance of 54.98% in the last 1 year, 34.48% in the last 3 years, and an since its launch. With a minimum SIP investment of just ₹ 500, this scheme offers a great investment opportunity for those looking to invest in FoFs Domestic.
Investors should rebalance their portfolio now and then to ensure they have the right set of investments. Investors can use FoFs Domestic Funds to rebalance their portfolios. When you get into a portfolio rebalancing transaction that involves FoFs, you will not have to pay any taxes on the capital gains.
However, if you sell your investments to buy any different kind of securities, you will have to pay a capital gain tax. Hence, FoFs Domestic Funds allows you to change your portfolio without incurring an additional cost.
International FoF funds are another set of FoFs through which you can invest in securities of several global companies. Hence, you get exposure to several international companies by investing in a singular fund.
Also, the best part about International FoF funds is that you do not have to set up multiple trading accounts for investing in these securities. These investment instruments are ideal for investors looking to diversify portfolios from a global level.
A gold fund is a popular FoFs Mutual Fund where the investors invest in gold via ETFs. 99.5% of the entire amount is invested in pure gold. However, an investor needs to have a Demat account if they are interested in investing in a gold fund of funds. All golf FoFs make investments in gold via the gold ETFs.
If you are a new investor and are unsure which mutual fund to choose, you can go with a fund that provides you exposure to a set of mutual funds. FoFs Domestic Funds can be a good investment point for new investors.
Also, FoFs are great investment tools if you want to invest in any foreign securities. Most funds are created by grouping several funds from the same asset class. Hence, if an investor wants to invest in mutual funds from different asset classes, a FoFs Domestic Fund might not be the best choice.
FOF Domestic Funds typically carry moderate risk but are still subject to market movements and fund manager decisions. For example, if the fund manager wants to maximise the returns from the investment, then they will invest in FoFs and have more mutual funds with high NAV and risk. However, if the fund’s goal is to provide long-term steady returns, low-risk mutual funds will be a part of the FoFs Domestic Fund.
Returns from FOF Domestic Funds vary based on the performance of the underlying mutual funds. On average, they may offer moderate returns, typically in the range of 10%–15%, depending on the market and fund selection.
Yes, FOF Domestic Funds are treated as non-equity funds. Gains are added to your income and taxed according to your income tax slab, regardless of the equity component in the underlying funds.
Start with an amount that fits your budget and aligns with your financial goals. Even ₹500–₹1,000 can be a good starting point, especially for investors seeking diversification with limited capital.