Systematic Investment Plans (SIPs) allow you to invest small amounts each month, which can be as small as Rs 500. These SIPs have given returns more than bank deposits in the last 3 years and offer you better tax efficiency than bank deposits.
Here are some of the SIPs, which are rated well, have a solid track record of returns and where you can invest a little amount every month. Check declared dividends from mutual funds here
DSP Blackrock Microcap Fund
This is one of the most sort after small cap funds in the country, because of the phenomenal returns that it has given in the past.
In fact, the fund has generated a return of 42 per cent in the last one year. We wish to inform readers that small cap funds can be more risky than large cap funds, because small cap stocks are high beta stocks and tend to fall faster than the markets.
In any case, DSP Blackrock Microcap Fund has also generated very good three year returns of 25 per cent. You can invest in the fund with a small SIP of Rs 500. The fund has holdings in Eveready Industries, Finolex Cables, SRF etc.
The current NAV of the fund under the growth plan is Rs 73.27.
HDFC Small Cap Fund - Regular Plan
This is another great small cap fund to own. The one year returns from the fund has been a fantastic 61 per cent, while the three year returns have been close to 23 per cent.
Very few funds can match these kind of returns. HDFC Small Cap Fund has investment in Sonata Software, Aarti Industries, Dilip Buildcon, Oriental Carbon etc.
You can start investing in the fund with a small amount of Rs 500. However, the initial investment is Rs 5,000. We wish to state that small cap funds are risky and if you want to take less risk, you can opt for large cap funds.
Reliance Top 200 Fund - Retail Plan
You can invest in the Reliance Top 200 Fund - Retail Plan, with a small sum SIP of Rs 100. Of course, the initial investment needed is Rs 5,000.
The Reliance Retail fund has generated a superb returns of 12.35 per cent on an average each year, in the last three years. The one year returns is still better at around 23 per cent.
The net asset value under the growth plan is Rs 31.90, thanks to the huge uptick the markets have seen this year. The fund has exposure to quality stocks like State Bank of India, ICICI Bank, Infosys and Larsen and Toubro.
Recently, the fund has increased exposure to ITC. This is probably among the few or perhaps the only SIP where the amount is as low as Rs 100.
Investors are advised to take advantage of the same. Most of the funds under SIP have been constantly increasing as investors have very limited avenues to park money given lower interest rates.
SBI Magnum Equity Fund
SBI Magnum Equity Fund is another fund that has given good returns. The fund has generated a return of 14.65 per cent in the last thee years on an average each year. This again is much better than bank deposits and if you opt for dividend distribution the returns are much better than bank deposits.
You can invest a small monthly sum of Rs 500 in the scheme. The net asset value of the fund is Rs 95.79 under the growth plan. Remember, that the dividend plans are more tax efficient as there is no tax on dividends received from mutual funds. The fund has exposure to the likes of HDFC Bank, Reliance Industries, ICICI Bank etc.
In addition it has smaller exposure to Kotak Mahindra Bank and Bharti Airtel. Again, the fund being a large cap one is heavily skewed in favour of large cap stocks. A good SIP with a very sound portfolio.
Good solid portfolio
Reliance Focused Large Cap Fund currently has an NAV of Rs 21.24 under the dividend plan and Rs 31.28 under the growth plan. You can invest in the fund with a small sum of Rs 100. The fund has given returns of near 29.72 per cent in the last one year. The expense ratio of the fund is slightly high at 2.20 per cent.
Reliance Focused Large Cap Fund has good holding including stocks like Maruti Suzuki, HDFC Bank, Larsen and Toubro, Indian Oil and ITC. Again, we suggest buying and opting for the dividend plans, because of the tax implications. We have not seen too much in terms of changes in the portfolio, though we must say that it looks very robust.
ICICI Prudential Focused Bluechip Equity
This fund has sizeable assets under management of more than Rs 16,000 crores.
This is another fund where you can invest with a small sum of as little as Rs 500. As for most funds, the initial amount to be invested is Rs 5,000. The fund has generated a returns of as much as 15.78 per cent in the last 3 years. The one year returns is higher at 31 per cent.
The fund has top holdings in HDFC Bank, ICICI Bank, State Bank of India, ITC, Maruti Suzuki India and Axis Bank.
ICICI Prudential Focused Bluechip Equity has an NAV of Rs 41 under the growth plan and Rs 25.84 under the dividend plan. The portfolio is more geared towards investors who are looking for long term growth. You may want to buy larger SIPs, when the chips are down. At the moment we suggest that you keep your Systematic Investment Plans at modest levels, given that markets have gone significantly higher.
The article is not a solicitation to buy, sell in securities or other financial instruments. Greynium Information Technologies Pvt Ltd, its subsidiaries, associates and the author do not accept culpability for losses and/or damages arising based on information in this article. The author and his family do not own any units in the above mentioned mutual funds.