The Systematic Investing Plans approach to mutual fund investment has made a space for itself in the financial sector and is now one of the most popular investment alternatives in India that investors choose. The major advantage of SIP is that it has something to offer any investor, whether they are low-risk or high-risk takers. A monthly sum of Rs. 500, Rs. 1,000, Rs. 2,000, etc., can be saved in a SIP plan to establish a solid financial future.In this post, we will learn about numerous mutual fund plans that might be beneficial in the future if Rs. 2,000 is contributed monthly.
SIP Plan Specifications
Let us take a closer look at the best-performing mutual funds in each mutual fund category, where an investor may put Rs. 2,000 SIP regularly and reap significant rewards in the future.
Large Cap Mutual Funds
Large capital corporations, as the term implies, are firms with significant equity market holdings. In general, the top 100 corporations in the market are huge cap companies that are exceptionally solid and stable. Large-cap capital investments are created when mutual funds invest in large company firms. If an investor chooses to invest in a large cap fund, the following funds should be considered:
Bluechip SBI Fund
This portfolio invests in equity-linked securities to assist investors in achieving their long-term capital appreciation aim. The SBI Bluechip Fund, which debuted on February 14, 2006, provides an extraordinary return of 11.69%. Ms. Sohini Adani manages the fund house. It is regarded as one of the greatest sip plans with somewhat high risk, and an investor may pay Rs. 2,000 regularly or even more based on market circumstances for extraordinary rewards.
Reliance Large Cap Fund
The Reliance Large Cap fund was founded on August 8, 2007, and is one of the greatest large cap funds to invest in. For monthly investment, the least SIP amount of Rs. 100 is required. For the last ten years, the returns have been greater than those of other mutual funds.
Mid Cap Funds
Companies ranked from 100 to 250 are classified as mid-sized in the financial sector. Mid cap funds are created when money is put into mid-cap corporations. If an investor chooses a midcap fund, the below funds should be considered.
The L&T Midcap Fund
Since its debut, returns have reached as high as 21.75%. L&T Midcap Fund is a high-risk stock mutual fund that was established on August 9, 2004. This small-cap fund, with an AUM of Rs. 1,323 crores, frequently outperforms the Nifty. A monthly commitment of Rs. 500 is required for this fund program, and the profits are unquestionably above average.
Motilal Oswal Midcap 30 Direct-Growth Fund
Motilal Oswal Midcap 30 belonged to the Stock category and was founded on December 29, 2009. It has an annualized return of 22.61% for the previous three years and 12.15% over the last five years. A minimum of Rs. 500 SIP can be chosen if the AUM exceeds Rs. 31,048 crores.
Small Cap Funds
Small-cap funds invest in firms ranked 250th and higher in the financial sector. If the investor wants to invest in small cap funds and is prepared to invest Rs. 2,000 monthly, the accompanying funds should be considered:
HDFC Small Cap Fund
Since its debut on April 3, 2008, the HDFC small cap fund has provided returns of up to 16.60%. It has an AUM of close to Rs. 2,152 crores and is regarded as one of the world’s best small cap funds in the Nifty market. HDFC small cap fund may be chosen with a monthly SIP of as little as Rs. 500.
Axis Small Cap Direct-Growth Fund
Axis Small cap fund pertains to the Equity category and was founded on September 4, 2009. It has annualized returns of 29.34% for the previous three years and 19.28% over the last five years. With an AUM of about Rs. 2,61,160 crores, a monthly contribution of Rs. 500 SIP can be chosen for excellent returns.
Why Should You Invest in Systematic Investment Plans?
- SIPs, which are one of the best methods to invest these days, have developed phenomenally in the financial market, delivering excellent returns. It is recommended for investors who want to outgrow their money in the long run. Here are some of the reasons why you should choose SIP as your next investing option:
- Returns are higher than those of many other investing alternatives.
- It provides rupee cost averaging, which allows an investor to purchase fewer shares when markets are high and more shares when the market is low.
- SIPs are considered low-cost and easy-to-afford investment solutions.
- It contributes to portfolio diversity.
Considerations Before Investing in SIP Mutual Funds, 2000 per month
Determine Your Requirements
You can invest in SIPS based on your requirements, and you can begin a SIP by depositing a little amount each month in a mutual fund. Rather than making a large lump sum commitment, attempt to make little monthly investments to relieve the financial burden.
Maintain a separate SIP for each respective goal.
Persons may have many objectives, and having different SIPS for each aim will help you assess your investment more effectively. Determine the best investment approach for a certain goal and consider investing in the appropriate sector of mutual funds based on your timeline.
Increase Your Investments Depending on Your
Individual Risk Tolerance
Your appetite for risk is the amount of risk you are willing to face while investing in a given asset class. Every investor has a different risk tolerance, which is influenced by a variety of criteria such as discretionary income, investing horizon, and other demands.
Analyze the Portfolio’s Performance After a Few Years.
A frequent evaluation of your SIP mutual fund portfolio is recommended. This should be done every three or four years to assist you to get rid of poor performers and improving the returns on your portfolio.
When investing in mutual funds, don’t merely aim for huge returns on investment. There are various aspects to consider when choosing a fund to fulfill your investing goals.
Before investing in SIP Mutual Funds, keep the following three points in mind:
- Higher Interest Rates: Do not invest just in the fund with the highest returns. Invest for the duration of time you want.
- Everybody’s financial situation is different:
Assess the funds in which you invest; for example, you should not invest in a fund just because it is popular.
- Monitor And evaluate: Examine your investment on a regular, but not too frequent, basis. Once every couple weeks is adequate.
Questions and Answers
Q1. Do SIP investments provide tax advantages?
Ans: Not all SIP programs provide tax advantages. SIP investments in equity-linked savings schemes qualify for tax exemption under Section 80C of the Income Tax Act.
Q2. Which are the highest and lowest SIP investment amounts?
Ans: With a minimum commitment of Rs.500, investors may begin investing through SIP. The maximum investment in SIP, on the other hand, has no upper limit.
Q3. How would I begin SIP funding?
Ans: Investors can begin making SIP investments in either an offline or online manner.
a. For the online approach, enter:
b. Visit the asset management firm’s official website (AMC).
c. Fill out all of the information for online SIP.
d. Along with KYC information, investors must submit a scanned copy of their address proof, cheque, account e. number, and ID evidence.
For the offline technique,
f. Visit the financial advisory firm’s branch office (AMC).
g. Fill out the motor and application forms completely.
h. Submit all necessary documentation, such as address and ID proof, together with the official status check, to the communal fund’s address.