Best Mutual Funds For SIP: Best SIP Plans For A 5 Year Period

India Business

Get the best mutual funds to invest in SIP. Learn about various Systematic Investment Plans (SIP) across large cap, small cap and multi-cap schemes. Invest in SIP mutual funds Now!

Written By Business Desk | Mumbai | Updated On:

A Systematic Investment Plan (SIP) allows you to invest your money in mutual funds. A SIP allows you to regularly invest a pre-determined sum as chosen by you, either quarterly, monthly, annually, or weekly. You can set a date every month to purchase mutual fund units and start with a savings plan. A SIP is an excellent financial instrument to inculcate a saving habit in the investor. Depending on your requirements, you could choose the best SIP plan for 5 years or more.  
The early bird gets the worm. This popular saying also holds true when it comes to investing in SIPs. You should start early, invest regularly, and stay invested for as long as possible to reap maximum benefits. It is stress-free. If you set standing instructions, the investment amount gets debited automatically from your account and is invested into mutual funds chosen by you. Investing in SIPs allows you to leverage two of the most powerful investing tools, which are rupee cost averaging and the power of compounding.

Reasons to invest in best mutual funds for SIP:

•    Rupee cost averaging  

Investing in SIP lets you average out the ratio of cost versus returns. Due to the volatile nature of the market, you can pick up more units while share prices are less, and vice versa. Investing in SIPs allows you to pick a larger number of shares at a lesser price, especially if you are looking at investing a decent amount.

•    Power of compounding  

Choosing the best SIP to invest in lets you accumulate a large corpus over time using the power of compounding.

•    Does not pinch your wallet  

You can start investing in SIPs with as less as INR 500. It does not burden you and gives you good returns in the long run.

•    Automation  

SIP automates payments every month, so you do not overlook or forget to make the monthly installment.

•    Emergency withdrawal  

Choose only the best funds for SIP. They let you withdraw the money whenever you wish. This is useful in case you have an emergency and need cash.

•    No need to time the market  

SIPs are investments that need to be made regularly. The market may rise or fall, but because of the long-term nature and regularity, it evens out. Therefore, you do not need to worry if the market falls.
Information from the Association of Mutual Funds of India (AMFI) clearly shows the increasing investments in SIPs over the last few years. 

There are more than 5,500 mutual funds available in India. Choosing the best SIP plans in India may be confusing and overwhelming. You must ensure that you invest your money only in the best mutual funds for SIP. Following are the different types of schemes available and the best performing ones.

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Large-cap schemes

These are schemes that invest in companies with a market capitalization of INR 20,000 crore and more. These schemes are suited for people who want to build up money without exposing their investments to an unstable market. 
Listed below are some of the top performers in these schemes. 
•    Aditya Birla SL India GenNext Fund (G)
•    ICICI Pru Dynamic Plan (G)
•    Quantum LT Equity Fund (G) – Direct
•    Aditya Birla SL Top 100 Fund (G)
•    ICICI Pru Top 100 Fund (G)

Mid-cap schemes

These invest in companies that have a market capitalization between INR 500 crore and INR 10,000 crore. If you are a risk-tolerant investor, you can opt for such schemes.
Following are some of the best funds in the mid-cap segment.
•    Canara Rob Emerg Equities Fund – Reg (G)
•    Franklin India Smaller Cos Fund (G)
•    Edelweiss Mid and Small Cap Fund – Reg (G)
•    L&T Midcap Fund – Reg (G)
•    Aditya Birla SL Small & Midcap Fund (G)

Multi-cap schemes

These schemes invest in the stocks of companies of all sizes, so you can have a varied portfolio. 
Following are some promising funds in the multi-cap segment.
•    HDFC Capital Builder Fund (G)
•    DSPBR Opportunities Fund – Reg (G)
•    Aditya Birla SL Equities Fund (G)
•    Franklin India High Growth Cos Fund (G)
•    Aditya Birla SL Advantage Fund (D)

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Equity-Linked Saving Schemes (ELSS)

These schemes invest in equity-oriented mutual funds and give you dual benefit. You can save tax and make money simultaneously. 
Here are some of the top schemes in the ELSS segment.
•    L&T Tax Advt Fund-Reg (G)
•    Invesco India Tax Plan (G)
•    Aditya Birla SL Tax Relief ’96 (ELSS U/S 80C of IT Act) (D)
•    DSPBR Tax Saver Fund-Reg (G)
•    Aditya Birla SL Tax Plan (D)
Always remember to do your homework. You must study the performance of different mutual funds. Accordingly, you can decide on the best SIP in India where you can invest your hard-earned money. 



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