The Nifty has hit new record highs and it may not be the best time to invest in equity mutual funds. This is why we have chosen a few schemes from the SBI Mutual Fund stable that include both debt as well as equities and a Gold ETF as well.
Here are 5 best SBI mutual Fund Schemes to invest in based on their past track record and also on ratings of select agencies. However, we wish to reiterate equity markets are at record highs and therefore at the moment the risks are high to invest in equity mutual funds.
SBI Hybrid Equity Fund
Since this is a hybrid fund, some amounts are invested in bonds as well, apart from equities. SBI Hybrid Equity Fund invests as much as 65 to 80% in equities and the balance in debt instruments like bonds.
The fund has a staggering Rs 36,000 crores assets under management. SBI Hybrid Equity Fund has generated around 42 per cent returns in the last 1-year, while the 3-year returns are 12.90% and the 5-year returns is 13.15%.
Presently, the fund has 69% exposure to equities, while 6.6% is in debt and around 14.4% is held in cash and cash equivalents. The equity portfolio of the fund includes names like HDFC Bank, Divis Labs and Infosys.
A slightly less risky fund, as a significant amount is invested in debt and a reasonable amount is being held in cash. Given that the stock markets are at a peak, this may not be a bad strategy.
SBI Small Cap Fund
This is a fund that has given phenomenal returns of 93% in 1-year, given the fact that the Sensex itself has jumped almost 60% in the last 1-year. We wish to warn readers, markets are at a peak, this fund has given solid returns already and those buying into this SBI Mutual Fund Scheme, would be doing so at the highest possible levels.
Therefore, caution is warranted and only those with a very high risk appetite can enter. We would strongly suggest invest, who like small caps to invest through the SIP plans of the fund.
The net asset value of the fund is Rs 89.27, under the growth plan. At the moment 94.6% of the funds are already invested.
Among the stocks in the portfolio include names like Elgi Equipment, JK Cement, Carborundum Universal and Sheela Foam.
SBI Short Term Debt Fund
Short term debt funds invest money in debt instruments that are maturing in a period of 1-3 years. Most of the investment of the SBI Short Term Debt Fund is in government of India securities or treasury bills.
Some of the funds are also invested in NCDs and Bonds, but, they are all AAA rated and include instruments issued by Reliance Industries, State Bank of India and L&T Finance Holdings.
The returns of the last 1-year are not very good at 5.75%, however, the 3-year returns has been decent at 8.75%. This is a good investment for those looking at safety of their investments and a reasonable return.
SBI Mutual Fund - Gold Exchange Traded Scheme Ltd
If you are looking to diversify from equity and debt, the best way would be to invest in gold through the ETF route. Gold ETFs track gold prices are safe, and cannot be stolen like physical gold.
SBI Gold ETF has given a 1-year returns of 3.07%, while the 3-year returns are 15.91% and 5-year returns are 9.94%. Gold ETFs are a good form of diversification and track gold prices. However, the last few years has seen this asset price as well rally quickly. A good investment for those looking to diversify their holdings.
SBI Bluechip Fund
This is a fund that invests primarily in largecap stocks. The risk of investing in such a fund is high, given that almost the entire amounts are invested in equities. SBI Bluechip Fund has generated a returns of nearly 59% in the last 1-year, while the returns in the 3-year and 5-year period are around the 14% mark on an annualized basis.
For those looking at long-term investment this fund may not be a bad bet.
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