10 Best Mutual Funds in UAE to Invest, 2025

What are Mutual Funds?

A mutual fund is an investment vehicle in which money from many investors is combined to purchase various assets. These funds are managed by professional asset managers who aim to generate returns in line with the fund’s objective, whether it’s growth, income, or capital preservation. In the UAE, mutual funds are a popular option for those seeking long-term wealth accumulation with comparatively lower risk than direct stock investments.

Here’s a curated list of some of the top-performing and popular mutual funds in UAE:

Top 10 Mutual Funds in UAE for 2025
Shelton NASDAQ-100 Index Direct (NASDX)	Fidelity Global Dividend Fund
Voya Russell Large Cap Growth Index Fund (IRLNX)	Fundsmith Equity Funds
Fidelity NASDAQ Composite Index (FNCMX)	Fidelity Emerging Market Funds
Voya Russell Large Cap Index Port I (ILRX)	Schroder ISF US Large Cap
Fidelity 500 Index Fund (FXAIX)	Invesco Perpetual Asian

*UAE Mutual Fund Returns are subject to change. Always verify current performance before investing.

Best Mutual Funds in UAE

Available in major currencies like US dollars, euros, and sterling, the top mutual funds offer a spectrum of opportunities if you want to invest in the region's vibrant market.

Here is a list of the best mutual funds in UAE —

1. Shelton NASDAQ-100 Index Direct (NASDX)

The Shelton NASDAQ-100 Index Direct (NASDX) is a mutual fund that is designed to replicate the performance of the largest non-financial companies listed on the NASDAQ stock exchange. This is one of the best mutual funds in UAE if you want exposure to major technology and non-financial companies without picking individual stocks. It provides a convenient way to invest in a broad section of the tech-heavy NASDAQ-100 index. 

Key holdings:  Apple Inc (9.37%), Microsoft Corp (7.79%), and NVIDIA Corp (7.41%), all leaders in the technology sector.

2. Voya Russell Large Cap Growth Index Fund (IRLNX)

The Voya Russell Large Cap Growth Index Fund (IRLNX) is set to match the performance of the Russell Top 200 Growth Index. Primarily investing in large-cap U.S. equities with high growth potential, this fund is designed for those looking to capitalise on large-cap growth stocks. 

Top holdings: Apple (10.99%), Microsoft (10.43%), and NVIDIA (9.09%), reflecting its focus on dominant tech giants.

The fund has experienced varied performance, with a notable year-to-date return of 9.04% and a five-year average return of 19.72%. In 2023, it achieved its best one-year total return of 45.99%. However, it also faced challenges in 2022, evident in its – 30.03% return.

3. Fidelity NASDAQ Composite Index (FNCMX)

The Fidelity NASDAQ Composite Index Fund (FNCMX) tracks the NASDAQ Composite Index. This is among the best mutual funds in UAE if you want to invest in tech and non-financial sectors.

Top holdings: Taiwan Semiconductor (6.53%), Microsoft (5.83%), and Apple (4.38%). This fund is actively managed and tech-centric, focusing on innovation leaders.

It has shown a year-to-date return of 6.35% and a five-year average return of 17.24%. The fund experienced significant growth in 2023 with a best annual return of 45.13% — this happened despite a challenging 2022, where it faced a -32.39% return.  On the whole, this performance reflects the tech market's volatility and growth potential.

4. Voya Russell Large Cap Index Port I (ILRX)

The Voya Russell Large Cap Index Portfolio Class I (IRLX) mirrors the performance of the Russell Top 200 Index, focusing on large-cap U.S. equities. It aims to offer investment results that correspond closely with the total return of the index.

Top Holdings: Apple (7.74%), Microsoft (7.26%), and NVIDIA (6.30%)—highlighting strong exposure to leading U.S. technology stocks.

As of the end of February 2024, the fund has seen a significant one-year change, indicating a positive performance within the said time frame.

5. Fidelity 500 Index Fund (FXAIX)

The Fidelity 500 Index Fund (FXAIX) tracks the S&P 500 and focuses on large-cap U.S. equities. Recently, it reported a 6.53% year-to-date return and a five-year average return of 14.63%. 

Top Holdings: Apple (7.01%), Microsoft (5.86%), and NVIDIA (5.57%)—focused on U.S. market leaders with consistent growth.

In 2023, the fund notably achieved a 26.29% return, recovering from a challenging 2022 where it saw an -18.13% return. 

6. Fidelity Global Dividend Fund

One of the best mutual funds in the UAE, Fidelity Global Dividend Fund uses a bottom-up approach to find and target the best dividend-paying companies around the globe. 

The focus of this fund is on harnessing the income and long-term capital growth potential. 

Top Holdings: Unilever (4.00%), Munich Re (3.92%), and National Grid (3.16%)—strong global firms with stable dividend histories.

7. Fundsmith Equity Funds

Next on the list of best mutual funds in the UAE is Fundsmith Equity Funds. Here, your funds are invested in global equities. The approach of this mutual fund is to make you a long-term investor in its selected stocks. 

The investment manager for this mutual fund needs to adhere to stringent investment criteria to create your portfolio. 

Top holdings: Meta Platforms (9.40%), Microsoft (8.94%), and Novo Nordisk (6.50%)

8. Fidelity Emerging Market Funds

In this mutual fund in UAE, the money is invested in the emerging markets of Latin America, Eastern Europe, South East Asia, Africa, and the Middle East. This mutual fund aims to achieve capital appreciation over time. 

The money is usually invested in companies with strong market positioning and competitive advantage. The fund also prefers companies that offer superior returns on their assets and have capitalised balance sheets. 

Top holdings: Naspers (8.61%), Taiwan Semiconductor (7.14%), and Samsung Electronics (3.73%)

9. Schroder ISF US Large Cap

Usually, the managers of actively-managed funds find it difficult to beat the US market, especially because the S&P 500 is driven by tech giants like Facebook and Amazon. 

This fund, among the top mutual funds in UAE, avoids such behemoths and finds value in medium-sized organisations that get mispriced by the stock market or look ready for a turnaround.

Key holdings: Microsoft (7.04%), Alphabet Class A (5.08%), and Netflix (4.39%), spanning tech and communication sectors.

10. Invesco Perpetual Asian

The Invesco Perpetual Asian Fund aims for long-term growth by investing in Asian and Australasian companies, excluding Japan. It primarily targets the technology and financial services sectors, with significant investments in top companies like Taiwan Semiconductor and Samsung Electronics.

Key Holdings: The top stocks in the portfolio are Taiwan Semiconductor (8.20%), Tencent (5.40%), and HDFC Bank (4.84%), offering strong exposure to Asian tech and financials.

Types of Mutual funds

There are four main categories of mutual funds in UAE, each with different risk levels and return potential. The main types include —

Types of Mutual funds	Description
Money Market Funds	These funds invest in short-term, low-risk securities such as government bonds and certificates of deposit (CDs). They are ideal for conservative investors looking for low-risk, stable returns, though their yields are typically lower compared to other types of funds.
Bond Funds	Bond funds invest in various types of bonds (government, municipal, corporate) and aim to generate income through interest payments. While they carry more risk than money market funds, bond funds often offer higher returns. The risk and returns vary depending on the type of bond the fund holds.
Stock Funds	Stock mutual funds invest in equities (corporate stocks). There are different types of stock funds, including — Growth Funds: Invest in companies expected to grow rapidly, with a focus on capital appreciation rather than dividend payouts. Income Funds: Focus on stocks that pay regular dividends, providing income alongside the potential for capital gains. Index Funds: Track a specific market index (e.g., S&P 500) and typically offer lower fees than actively managed funds. Sector Funds: Focus on specific industries, such as technology, healthcare, or energy.
Target-Date Funds	These funds are designed for investors targeting a specific retirement date. They hold a diversified mix of stocks, bonds, and other assets. As the target date approaches, the allocation gradually shifts towards more conservative investments. These funds are a good option for those looking for a hands-off investment approach.

Why Consider Mutual Funds in UAE?

Mutual funds are ideal for the UAE residents and NRIs who —

• Want a diversified portfolio without picking individual stocks
• Prefer professional fund management
• Seek long-term wealth creation
• Want flexible investment options like SIPs (Systematic Investment Plans) or lump-sum contributions

Key Advantages:

• Diversification across multiple asset classes and markets
• Professional Management by experienced fund managers
• Liquidity, allowing you to buy or sell units anytime
• Accessibility through local banks and online investment platforms like Policybazaar.ae
• Regular Systematic Investing and withdrawals to make regular payments to save regularly

Mutual Funds Regulatory Update (Effective April 1, 2024)

The UAE Securities and Commodities Authority (SCA) has implemented new regulations to choose the best mutual funds in UAE —

• Foreign mutual funds are limited to private placement for Professional Investors (with AED 4 million+ in net assets)
• Locally domiciled funds can be publicly offered to Retail Investors
• Investors must confirm their classification (Professional vs Retail)

This regulatory change makes locally available funds more important for retail investors. Always check whether your chosen fund complies with the latest regulations. 

How to Choose the Best Mutual Funds in UAE?

To enjoy the best UAE mutual fund returns that match your financial goals, consider the following —

1. Identify Your Investment Goals

Are you investing for retirement, wealth growth, income, or capital preservation?

2. Risk Appetite

• Low risk? Opt for the money market or bond funds
• High growth? Consider equity or sectoral funds

3. Choose Active or Passive Strategy

• Active Funds aim to outperform the market but often come with higher fees
• Passive Funds track indices and have lower costs

4. Review Past Performance & Returns

Look at UAE mutual funds returns over 1-year, 3-year, and 5-year periods to gauge consistency.

5. Check Expense Ratios

Fees can eat into your returns. Aim for funds with competitive expense ratios.

6. Use SIP for Regular Investment

If you prefer not to invest a lump sum, Systematic Investment Plans (SIPs) allow you to invest monthly. You can use a SIP calculator to estimate your future returns.

Where to Invest in Dubai Mutual Funds?

You can invest in Dubai mutual funds through:

• Banks like HSBC, Citibank, Emirates NBD, Mashreq, and FAB
• Online platforms like Saxo Bank, Policybazaar.ae, and eToro
• Wealth management firms and financial advisors

These platforms also offer helpful tools like fund screeners, SIP calculators, and portfolio rebalancing options to optimise your investment strategy.

Use of SIP Calculator in Mutual Funds

A Systematic Investment Plan (SIP) calculator is a tool that helps investors estimate the potential returns of their mutual fund investments over time. By entering details such as the monthly investment amount, expected rate of return, and investment duration, the SIP calculator provides an estimate of the total amount invested and the potential corpus at the end of the term.

Use our SIP calculator to calculate your estimated returns or how much to invest in mutual funds in Dubai.

Final Thoughts: Are Mutual Funds a Good Investment in the UAE?

Absolutely—mutual funds in UAE are among the most versatile and beginner-friendly investment options. With a wide variety of fund types, low barriers to entry, and regulatory clarity, they are well-suited for both conservative and aggressive investors.

To make informed decisions, use tools like SIP calculators, consult with advisors, and leverage platforms like Policybazaar.ae to compare and invest in the best mutual funds in UAE that align with your financial goals.

Start your investment journey today with the right mix of mutual funds in UAE. Diversify wisely, review regularly, and invest smartly.

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