List of Best Mutual Funds to Invest via SIP Plans
The following is a short list of equity mutual funds that provide the best option for individuals seeking to invest in high ROI schemes via the SIP Plans route. The key criteria used to pick these funds from the wide range of available investment options were as follows:
- All these funds have shown exceptional performance over the past 3 to 5 years.
- CRISIL Rated funds of Ranks 1 and 2 have been placed towards the top of the list.
- High rating of 4 or above was obtained by all of these funds from Value Research Online.
Additionally, this list also features inputs from Paisabazaar.com’s in-house experts who have extensive experience in selecting the best investments depending upon the changing conditions of India’s securities market.
Best Mutual Fund SIP Investment Plans 2019
|Fund Name||1 Year Returns||3 Year Returns||5 Year Returns|
|Axis Bluechip Fund||6.77%||14.38%||13.94%|
|Mirae Asset Tax Saver Fund (ELSS)||2.42%||19.80%||–|
|Franklin India Prima Fund||-7.60%||11.16%||17.74%|
|ICICI Prudential Value Discovery Fund||-2.37%||8.66%||14.52%|
|Axis Long Term Equity Fund (ELSS)||-0.61%||13.44%||17.33%|
|HDFC Small Cap Fund||-11.94%||17.05%||18.26%|
|DSP Equity Opportunities Fund||1.74%||16.25%||17.60%|
|Mirae Asset Emerging Bluechip Fund||-4.95%||18.63%||_|
|Invesco India Contra Fund||-4.23%||15.25%||19.93%|
|Kotak Standard Multicap Fund||10.67%||18.65%||15.50%|
*3 year/5 year returns are annualised. Direct – Growth Options of Funds considered. Data based on NAV of direct growth variant of schemes as on May 10, 2019.
Axis Bluechip Fund
Axis Bluechip Fund has emerged as one of the top performing large-cap funds of 2018. Its outperformance is impressive considering the widespread failure of actively managed funds in the last year.
While most of the mutual fund schemes had fallen behind their benchmarks in their 1-year returns, Axis Bluechip Fund still managed to outperform it. Its performance also holds good over a longer time period. Its 5 year CAGR of 15.16% compares favourably to 13.22% on the Nifty (as of May 2019).
The fund manager, Shreyas Devalkar has been at the helm since November 2016 and is an industry veteran. He holds few stocks (just 24 currently) but picks them well. As a large cap fund, mandated to hold 80% of its assets in India’s largest companies, Axis Bluechip is expected to provide a solid foundation to a powerful 2019 mutual fund portfolio.
Mirae Asset Tax Saver Equity Fund
Mirae Asset Tax Saver Equity Fund, a Mirae AMC product, has become immensely popular in a short period of time due to its stellar returns. The fund has not only outperformed its benchmark by a huge margin but also successfully beat its peers. It was launched in 2015 and currently operating with an AUM of 1,949 crore.
The fund has returned at 19.25% CAGR in the last 3 years compared to 13.85% returns of its benchmark S&P BSE 200. (Data as on May 10, 2019)
It holds about 77% of its portfolio in large-cap and the rest 23% of its assets have been allocated to mid and small cap space. With 58 stocks in its portfolio, the asset class looks well diversified. The fund holds market giants such as HDFC Bank, Reliance Industries, L&T, TCS, Maruti in its portfolio which makes it stand firm in times of market turmoil.
Franklin India Prima Fund
Franklin India Prima Plus Fund is the premier equity fund offering from the Franklin India Mutual Fund AMC, one of India’s leading fund houses. The proposed aim of this mutual fund scheme is to provide capital appreciation along with regular dividend income to the investors.
In order to achieve this goal, the fund has primarily invested in a range of securities across equity, debt and money markets. The fund is also expected to focus their investments on companies capable of creating wealth irrespective of market capitalization and sector bias.
At present, an estimated 75% of this equity mutual fund’s portfolio consists of large cap equity investments, while the remainder is spread across other investment options. Franklin India Prima Plus Fund has provided returns of over 18% and in excess of 19% over the past 3 years and 5 years respectively.
ICICI Prudential Value Discovery Fund
In case you are looking for SIP plans that invest in an equity fund focused on making value stock investments, you need to look no further, as the ICICI Prudential Value Discovery Fund fits the bill perfectly. The opinion of what exactly are “value stocks” may vary from one expert to another, however, these stocks do share a few common traits.
These stocks are expected to have great future growth potential while being reasonably valued in the current market conditions. Alternately, these stocks feature attractive low valuations with respect to their book value, earnings or future/current dividends. The strategy has worked out quite well for this ICICI Prudential AMC fund as it has consistently maintained a high rating since its launch way back in 2004.
Originally the fund was quite heavily invested in mid-cap stocks, which made it seem like a risky investment to risk-averse investors, but in recent times, its large cap exposure has grown to be as high as 80%, which signals an increase in the possibility of consistent future returns in the long term.
Axis Long Term Equity Fund
The Axis Long Term Equity Fund has been one of the most favoured SIP plans for investors seeking consistent returns on their tax saving investments. The mutual fund is focused on generating consistent ROI in the long term through a portfolio comprising high-quality equity stocks and equity derivatives.
The exceptional performance of this mutual fund is best illustrated by the fact that the Axis Long Term Equity Fund has managed to provide consistently high returns to its investors outperforming its benchmark as well as its peers since its launch over a decade ago.
With returns computed at over 17% and in excess of 23% over the 3-year and 5-year periods, this premier tax saving ELSS fund offering has been a preferred investment choice for Indian mutual fund investors from various walks of life.
HDFC Small Cap Fund
The HDFC Small Cap Fund has displayed eye-popping outperformance of late. Over the past year, the fund contained losses at around 9% compared to a whopping 19% losses on its benchmark, the Nifty Small Cap Index. This can be attributed to the rough ride that mid and small cap category stock had in 2018.
Despite the blood bath of 2018, the fund has managed to provide 5-year CAGR at 20.83% outperforming its benchmark, the Nifty SmallCap at 16.04% in the same period. Unlike the typical financial stocks that dominate most mutual fund portfolios, HDFC Small Cap Fund has taken outsized exposure to chemicals, engineering and services companies with a combined weight of 41%.
The fund has invested 57% of its assets in small cap companies and about 36% in the mid-cap space which leaves with about 6% exposure to large caps. Currently, the fund does not hold any significant cash component which shows its optimism about growth in mid and small cap space.
DSP Equity Opportunities Fund
The primary objective of the DSP Equity Opportunities Fund is to provide capital appreciation to its investor while the secondary objective is to generate income as well as ensure dividend distribution. The focus of this leading equity mutual fund has been to invest in top-rated equities as well as equity-linked investments in order to achieve its stated objectives.
Moreover, in order to distinguish itself from its peers, the fund has historically maintained a highly diversified portfolio of investments, which has helped achieve its aim to consistently and significantly outperform competing equity funds.
With the 3 -ear and 5-year returns provided by DSP Equity Opportunities Fund currently computed at over 19% and over 23% respectively, this investment is one of the most suitable for investors seeking a high performing SIP Plan investment to meet their long-term investment goals.
Mirae Asset Emerging Bluechip Fund
Mirae Asset Emerging Bluechip Fund has remained a top performing fund in the large and mid cap category of mutual funds. With a 5-year return of 23.74% CAGR, the fund has outperformed its benchmark, S&P BSE 250, (14.09%) by a huge margin.
In the near term also, the fund performance has been impressive with a 1 year return at 2.11%, successfully beating its category returns which stood at -3.48%. Interestingly, the direct plan of the fund operates at a very low expense ratio in its class.
The fund has invested about 55% of its assets in large caps and 40% in mid-cap space. About 5% of the portfolio is invested in small cap companies. With a total of 62 stocks in its portfolio, the asset class looks well diversified. However, the fund has invested about 33% of its assets in the financial sector.
The fund is being managed by Neelesh Surana since 2013. Neelesh has been a consistent performer while managing multiple funds of Mirae AMC. Recently, in January 2019, Ankit Jain has also joined Neelesh for the management of the fund.
Invesco India Contra Fund
The fund has been a top performer in contra fund category. Contra bets are basically a type of value investing where the fund manager invests in such stocks which are presently facing headwinds and underperforming.
The fund has generated 5 year returns at 19.93% CAGR beating its benchmark, S&P BSE 500, which could only give returns at 13.65%. Further, the fund has also outperformed its category average by a huge margin which stood at mere 14.67%.
The portfolio analysis of the fund reveals that the fund is heavily invested in large cap stocks at present. With 65% of the asset allocated to large cap stocks makes the fund stand sturdy in the times of volatility. The mid and small cap space has been allocated about 33% of the portfolio which makes it a growth-oriented fund.
The fund may look pretty concentrated with 35% of its portfolio stocks coming from the financial sector. However, the asset allocation is in line when compared to the portfolio allocation of the benchmark.
The fund is being jointly managed by Amit Ganatra and Taher Badshah and is expected to perform well in the coming times.
Kotak Standard Multicap Fund
Kotak Standard Multicap Fund is the flagship scheme of Kotak AMC and the scheme that has brought fame to the AMC. It has delivered returns at 19.48% over the past 5 years, far above the 13.95% returns delivered by its benchmark S&P BSE 200. The fund was launched in 2009 and currently managing an AUM of Rs. 23, 881 crore.
The fund has been managed by Harsha Upadhyaya since 2012. Harsha has swerved strongly towards large caps to shield investors from the volatility of 2018 and 2019, placing 77% of its assets in large caps.
It has another 21% of its assets in mid-caps and 1% in small caps which opens it up to growth opportunities in the mid-cap space. The fund is also fairly diversified with as many as 56 stocks. Relatively cautious equity investors will find themselves well taken care of in this fund.
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Q. What is Systematic Investment Plan (SIP)?
A. SIP or Systematic Investment Plan invests a fixed amount each month in a mutual fund. It averages out your purchase price and protects you from the risk of investing a lump sum during a market high. If the market falls after your SIP installment, you can accumulate more mutual fund units in the next installment and so on. As a result, when the market recovers you will get a higher return than a lump sum investment.
Q. How does SIP Work?
A. A systematic investment plan is typically a monthly investment but it can also be weekly, monthly or quarterly in nature. Investments can be made at various intervals according to your preference.
Q. How To Set Up SIP?
A. In order to set up a SIP, you fill up a SIP form and a bank mandate. With online platforms like Paisabazaar, you can complete both these steps online in a matter of minutes by filling in your KYC details such as Aadhar and your bank details for debits.
The amount deducted is then invested in the mutual fund scheme of your choice according to the applicable NAV.
Q. How is NAV Calculated?
A. For example, let’s say you set up a Rs. 1,000 monthly SIP plan for 12 months starting from the 7th of the month. Every month around the same date, your bank account will show a Rs. 1,000 deduction towards investment in the mutual fund of your choice.
The case of applicable NAV is based on whether the 7th is a day when the markets are open or closed. If the 7th is a working day for the stock market, the applicable NAV for your SIP installment would be the chosen mutual fund’s NAV at the close of markets on the 7th. If 7th is a holiday such as a Saturday, Sunday or Public Holiday, then the applicable NAV would be the one obtained at the end of the next working day.