Technology mutual funds emerged as the best-performing equity mutual fund category in October 2026, delivering an average return of 6.29%, while no other mutual fund category managed to cross the 1% mark. The strong performance put technology-focused schemes ahead of other equity categories during the month, although returns varied considerably across individual funds.
Of the 13 technology funds considered, HDFC Technology Fund delivered the highest return at 11.54%. Kotak Technology Fund and ICICI Prudential Technology Fund followed with gains of 8.86% and 8.22%, respectively.
However, the rally was not uniform. Motilal Oswal Digital India Fund was the only scheme to post a negative return, declining 2.72% in October. Quant Teck Fund delivered a relatively modest 1.67% return.
HDFC Technology Fund leads October returns with 11.54% gain
HDFC Technology Fund topped the list of technology mutual funds, delivering an 11.54% return in October. The scheme had assets under management (AUM) of ₹1,371 crore as of 1 November 2026, according to Value Research data.
Kotak Technology Fund, with an AUM of ₹479 crore, delivered an 8.86% return. ICICI Prudential Technology Fund, the largest scheme in the list with an AUM of ₹12,505 crore, gained 8.22%.
Tata Digital India Fund and SBI Technology Opportunities Fund also delivered strong returns of 7.99% and 7.91%, respectively. Their AUM stood at ₹9,276 crore and ₹4,155 crore.
|
Mutual fund scheme |
October returns |
AUM ( ₹ crore) |
| HDFC Technology Fund | 11.54% | 1,371 |
| Kotak Technology Fund | 8.86% | 479 |
| ICICI Prudential Technology Fund | 8.22% | 12,505 |
| Tata Digital India Fund | 7.99% | 9,276 |
| SBI Technology Opportunities Fund | 7.91% | 4,155 |
| Franklin India Technology Fund | 7.65% | 1,623 |
| WhiteOak Capital Digital Bharat Fund | 7.03% | 510 |
| Source: Value Research. All returns are for direct plans. | ||
Franklin India Technology Fund returned 7.65% in October, with an AUM of ₹1,623 crore. WhiteOak Capital Digital Bharat Fund gained 7.03%, while Invesco India Technology Fund delivered 6.68%. Their respective AUMs stood at ₹510 crore and ₹317 crore.
Aditya Birla Sun Life Digital India Fund returned 6.51%, with an AUM of ₹3,617 crore.
Funds with the highest AUM delivered mixed returns in October
The three largest technology funds by AUM delivered varied returns in October. ICICI Prudential Technology Fund, the largest scheme in the category with an AUM of ₹12,505 crore, gained 8.22%. Tata Digital India Fund, with an AUM of ₹9,276 crore, returned 7.99%, while SBI Technology Opportunities Fund, with ₹4,155 crore in assets, delivered 7.91%.
The figures indicate that a larger asset base did not necessarily translate into stronger monthly performance. HDFC Technology Fund, despite having a smaller AUM than several peers, delivered the highest return in October.
The October performance, however, should not be viewed in isolation. Technology funds are sectoral funds that concentrate investments in technology-related companies, exposing investors to sector-specific risks. Their returns can be influenced by global IT spending, demand for software services, client budgets, currency movements and developments in artificial intelligence.
Investors should consider their risk appetite, investment horizon and existing portfolio exposure before investing in sectoral funds. A strong one-month performance does not necessarily indicate that the category will continue to outperform.