New Delhi, June 25 -- Every year, mutual fund rankings create a familiar temptation. A small-cap fund delivers 30-40% returns, a thematic fund doubles investors' money, and investors begin asking the same question: Should I move my money there?

The answer, more often than not, is no.

"The belief that yesterday's winners will continue to be tomorrow's winners is one of the biggest misconceptions in mutual fund investing," said Debasish Mohanty, chief strategy officer at The Wealth Company Mutual Fund.

The biggest limitation of return rankings is that they only tell investors what has already happened.

According to Rishabh Garg, CEO-Digital at FundsIndia, one-year returns reflect a specific market environment, including which sectors we...