The measure
A fund's maximum drawdown is its largest fall from a peak NAV to a later trough. It says what the worst stretch of holding the fund felt like, which an average return never does. This post uses each fund's drawdown over the last three years to 5 October 2026, from daily NAVs, for Direct Growth equity plans.
Category by category
| Category | Funds | Median worst fall | Worst fund | Mildest fund | Median 3-year return |
|---|---|---|---|---|---|
| Large cap | 30 | -16.4% | -21.1% | -13.3% | 9.3% |
| Focused | 27 | -17.8% | -31.3% | -12.9% | 11.5% |
| Value | 21 | -18.0% | -26.1% | -13.7% | 11.6% |
| Flexi cap | 36 | -18.5% | -26.7% | -11.0% | 11.6% |
| Contra | 3 | -18.6% | -18.9% | -15.8% | 13.2% |
| Large & mid cap | 26 | -18.7% | -26.1% | -14.2% | 12.4% |
| ELSS | 48 | -18.8% | -29.6% | -14.7% | 10.6% |
| Dividend yield | 9 | -18.9% | -20.7% | -15.9% | 10.4% |
| Multi cap | 23 | -19.8% | -25.3% | -15.1% | 13.7% |
| Mid cap | 29 | -21.2% | -28.9% | -16.8% | 15.8% |
| Sectoral / thematic | 142 | -21.3% | -41.9% | -13.5% | 13.3% |
| Small cap | 26 | -24.1% | -30.9% | -18.2% | 14.6% |
Returns are annualised over three years. Four things stand out.
- Nobody was spared. Of 420 equity funds with a three-year drawdown, 24 fell less than 15%. The mildest single fund fell 11.0% (a flexi cap fund).
- The ordering follows size. Large cap is shallowest, mid cap deeper, small cap deepest at a median of 24.1%.
- Sector funds have the widest spread. The worst fell 41.9%; the mildest 13.5%. The median, 21.3%, hides both.
- Focused funds can be fragile. The category median is the second shallowest, but one fund fell 31.3%, more than any other outside sector funds.
Against the index
The Nifty 50 fell from 26,216.05 to 22,082.65, or 15.8%, by 4 March 2025, the deepest point of its last three years. The median large cap fund's drawdown, 16.4%, is slightly worse. In a three-year window with an index fall of that size, the average large cap fund did not protect you better than the index, and the best ones fell 13.3%.
Return for the fall
Dividing each category's median three-year return by the size of its median worst fall gives a rough price of each point of return.
| Category | Return ÷ fall |
|---|---|
| Mid cap | 0.75 |
| Contra | 0.71 |
| Multi cap | 0.69 |
| Large & mid cap | 0.66 |
| Focused | 0.65 |
| Value | 0.64 |
| Flexi cap | 0.63 |
| Sectoral / thematic | 0.62 |
| Small cap | 0.61 |
| Large cap | 0.57 |
| ELSS | 0.56 |
| Dividend yield | 0.55 |
Mid cap funds earned 15.8% a year for a 21.2% fall. Large cap funds earned 9.3% for 16.4%. This is a ratio of two medians, not the median of a ratio, and the last three years are a single path. They do not say mid caps are better value. They say that in this window the extra fall in mid caps was more than repaid.
What this does not tell you
It is one window. A drawdown is a single peak and a single trough. Change the three-year start date and the figures change with it.
Recovery is not measured. A fund that fell 20% and has recovered looks the same here as one still at the bottom. Our back above February post looked at recoveries.
Median funds are not your fund. The spread within each category is wide, as the worst and mildest columns show.
Small categories mislead. There are only three contra funds.
Where to go from here
The small cap drawdowns post goes deeper on the deepest category, and the guide to psychology of a market crash covers what to do while one is under way. Compare individual funds in the screener.
Frequently asked questions
How far have equity funds fallen from peak to trough in three years?
The median fund's worst fall in the three years to October 2026 ranged from 16.4% for large cap funds to 24.1% for small cap funds. Across 420 Direct Growth equity funds only 24 had a worst fall shallower than 15%.
How does that compare with the Nifty 50?
The Nifty 50's worst fall in the same three years was 15.8%, from 26,216.05 to 22,082.65 on 4 March 2025. The median large cap fund's was 16.4%, so large cap funds as a group did not cushion the index's worst stretch.
Which category earned the most for the fall it endured?
Mid cap funds. Their median three-year return was 15.8% a year against a median worst fall of 21.2%, a ratio of 0.75. Large cap (0.57), ELSS (0.56) and dividend yield funds (0.55) had the lowest ratios.
This is commentary on published data, not investment advice. WealthTicker is not a SEBI-registered adviser or distributor. Figures are as of the dates stated and can be revised by their source.
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