Sharekhan Blog

Which Are The Best SIP Mutual Funds For Long Term Investment?

  • Mar 4, 2024

The main benefit of SIPs is that they lower the risk involved with lump sum investments by enabling you to make small, regular deposits over time. However, picking the best mutual funds for long-term investments can be overwhelming, given the abundance of options. So, let's discuss the best performing SIP or best mutual fund for SIP for long-term investment.

How do SIPs Work?

Prior to making an investment through the SIP route, an investor must first make sure that they are KYC-compliant. This means the person must submit the necessary paperwork for that, such as proof of identity and bank account information. After that, they are free to make investments through various online aggregator platforms or asset management organizations' web portals.

Investors receive units based on the net asset value of that day after the funds are taken out of their account.

Best Mutual Funds SIP to Invest In India for Long Term

Here are the best SIP plans to invest in India: -

1.    The Axis Bluechip Fund

  • Renowned for its emphasis on large-cap equities, Axis Bluechip best SIP plan for 5 years provides steady returns over an extended period.
  • This fund, which has a history of exceeding its benchmark, is appropriate for investors looking for consistent returns with less volatility.
  • Because the fund's portfolio consists of reputable businesses with solid fundamentals, it is a dependable option for building wealth over the long run.

2.    ICICI Bluechip Prudential Fund

  • Within the large-cap category, the ICICI Prudential Bluechip Fund is among the biggest and most well-known funds.
  • The best SIP for long term is well-known for its cautious investment strategy, which mostly makes investments in reputable bluechip businesses that provide stability and reliable returns.
  • For cautious investors looking for capital growth with comparatively less risk exposure, this fund is appropriate.

3.    Kotak Standard Multicap Fund

  • A diversified equity fund that makes the entire investments in large-cap, mid-cap, and small-cap stocks is called Kotak Standard Multicap best mutual funds for SIP.
  • The fund offers a balanced risk-return profile by taking advantage of opportunities across market capitalizations through a flexible investment strategy.
  • Investors hoping to create wealth over the long term and seeking diversity across market categories might choose this investment.

4.    IDFC Infrastructure Fund

  • Long-term SIP sector fund IDFC Infrastructure Fund makes targeted investments in a range of industries, including telecom, infrastructure, banking, and pharmaceuticals.
  • This fund provides the opportunity for significant gains by investing in a sector that is anticipated to grow over the long run. The safety and development potential of infrastructure makes the IDFC Infrastructure Fund an appealing investment option.
  • In just a year, the fund has generated excellent returns of 103.1%.

5.    PGIM India Diversified Equity Fund

  • One of the best-performing diversified equities funds in India is PGIM India Diversified Equities Fund. By distributing investments among large-cap, small-cap, and mid-cap companies with varying market capitalizations it provides a well-balanced portfolio for increased safety.
  • This fund has a history of steady growth and has produced outstanding returns of 66.4% over the course of a year. With the help of the PGIM India Diversified Equity Fund, you can potentially experience consistent and significant development.

6.    SBI Small Cap Fund

  • Targeting emerging companies with a market value of about INR 500 Cr, the SBI Small Cap Fund is the long-term best SIP to invest offered through systematic investment plans.
  • As these businesses grow, this approach might provide substantial profits. The fund has demonstrated a solid track record, with remarkable one-year returns of over 62.2%.
  • Additionally, it provides the ease of having a 500 INR annual minimum investment requirement.

Benefits of Investing in Mutual Funds through SIP

1.    Financial Discipline

Financial discipline is ingrained by SIPs, which assist you in investing a certain amount on a monthly basis and discourage rash investment decisions.

2.    Rupee Cost Averaging

With SIPs, you invest a certain amount at regular intervals, so you purchase more units during periods of low price and fewer units during periods of high price. By averaging out your investment costs, this lessens the effect of market volatility.

3.    Compounding Effect

You can potentially increase your returns by utilizing the power of compounding and making regular investments over an extended period of time.

4.    Cost-effectiveness

SIPs make investing accessible to novices or those on a tight budget since they let you start with tiny sums.

The Bottom Line

SIP investing in mutual funds is a wise strategy for long-term wealth creation. It's crucial to conduct independent research and select funds that fit your risk tolerance and investing goals, though. Making an informed choice and assembling a solid investment portfolio for the future is possible if you take into account the points covered in this book and investigate various mutual funds.

Team Sharekhan
by Team Sharekhan

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