The Motilal Oswal Nasdaq 100 Fund of Funds has emerged as a top performer in the overseas category, posting a 42.7% return over the last six months. With ₹8,583 crore in assets, it significantly outperformed its benchmark, though investors should note that past performance in international markets depends heavily on currency fluctuations and underlying US tech stock movements.
What Happened
The Motilal Oswal Nasdaq 100 Fund of Funds (FOF) has outperformed its peers in the overseas mutual fund category, delivering a return of 42.7% over the past six months. As of July 2, 2026, data from ACE MF indicates that this fund leads the category, comfortably ahead of other schemes such as the Kotak Global Emerging Market Overseas Equity Omni FOF, which returned 26.5%, and the Edelweiss US Technology Equity FOF, which returned 24.2% during the same period.
Scale and Benchmark Performance
Beyond recent returns, the Motilal Oswal fund holds a dominant position in terms of size, managing ₹8,583.3 crore in assets. Among major funds with over ₹1,500 crore in assets, it currently commands the largest corpus. The fund has also demonstrated a track record of beating its benchmark index. Over a one-year period, it reportedly outpaced its benchmark by 46.1 percentage points, while maintaining a consistent lead over three years with a 39.9% return compared to the benchmark's 24.5%.
How Investors May Read This
Investors looking at international funds should understand that a Fund of Funds (FOF) structure works by investing in other mutual funds, in this case, those based outside India. While the performance appears strong, it is primarily driven by the underlying Nasdaq 100 index, which consists of large-cap US technology and growth companies.
When a domestic Indian fund invests abroad, the returns are influenced by two main factors: the price performance of the stocks in the foreign index and the movement of the Indian Rupee against the US Dollar. If the Rupee depreciates against the Dollar, it can provide an extra boost to returns for Indian investors. Conversely, if the Rupee strengthens, it may dampen the gains.
Risks and Considerations
It is important for investors to recognize that international funds carry different risks than domestic equity funds. These include geopolitical risks, changes in foreign tax laws, and currency volatility. Furthermore, the Nasdaq 100 is heavily concentrated in the technology sector, which can be more sensitive to US interest rate changes and global demand for tech products. High historical returns over three or six months do not guarantee future performance, and sector-specific downturns in the US market can lead to sharp corrections in these funds.
What Investors Should Track Next
Investors should look beyond short-term ranking tables when choosing international funds. Key monitorables include the expense ratio of the fund, as these schemes often have higher costs due to the underlying fees of the foreign funds they hold. Additionally, monitoring the RBI’s limits on overseas investments and the liquidity of the underlying foreign assets remains essential for long-term planning.