Top 5 Mutual Funds for SIP to invest in 2019

Top 5 Mutual Funds for SIP to invest in 2019Top 5 Mutual Funds for SIP to invest in 2019


There are thousands of mutual fund schemes in India. Many investors are confused as to which mutual fund scheme is best for them. There are several categories of equity mutual funds like large cap, midcap, smallcap and balanced funds. One of the regular readers Mr. Rajkumar asked me one question. If I have to recommend only Top 5 Mutual Funds for SIP, that too 1 from each such category, which are those funds? This was a difficult task for me. Finally, I have filtered 5 best SIP Plans for 2019 with some analysis. Which are the Top 5 Mutual Funds for SIP to invest in 2019 in India?

Also Read: Best SIP Mutual Funds to invest for 10 years

What is Systematic Investment Plan (SIP) in Mutual Funds?


If you are already aware about SIP, skip this section.

Systematic Investment Plan (SIP) is a facility offered by mutual funds to invest specific amount in mutual funds. SIP allows investors to invest a specific amount at pre-defined intervals. One can do SIP either daily, weekly, fortnightly, monthly, quarterly, half-yearly or yearly. However, most of the investors invest in monthly SIP. You can check SIP investment calculator to get a view about how much value your investment would grow based on the SIP investment and expected rate and tenure. 

You can refer this video to know more about SIP.

Credit: Yadyna Investment Academy

How we filtered Top 5 Mutual Funds for SIP to invest in India in 2019?


We have considered below parameters to filter some of these mutual funds.

1) Mutual Fund Schemes from Large-cap, Multi-cap, Midcap, Smallcap and Hybrid category are considered. This way we are covering all types of equity mutual fund schemes. We have not considered sector funds or debt mutual funds.

2) Mutual Fund schemes that performed well in various market cycles in the last 5-10 years are considered.

3) Weight age is given to short term performance too, as stock markets are volatile in the last 1-12 month period.

4) Mutual funds considered that are rated as 3-star, 4-star and 5-star by Value Research Online.

5) Assets Under Management (AUM) of > Rs 500 Crores are considered. This shows that there is investor confidence.

6) These mutual funds could be a repetition in our earlier recommendations. If you are already investing, continue to invest.

How we filtered only Top 5 mutual funds from the total list?


From each category (like large cap), we analyzed top performing mutual funds and filtered only 1 fund. This way we filtered 1 mutual fund scheme each from large cap, midcap, smallcap, multi cap and balanced mutual funds segments. This way we have considered 5 mutual funds.

Who can invest in these Top 5 Mutual Funds for SIP in India?


If you are falling in any of the below categories, you can consider investing in these funds.

1) One mutual fund each is filtered from large cap, multi cap, midcap, smallcap and balanced category. This is perfect balance among all types of mutual funds. These are for moderate to high risk investors. If you are a low risk investor, ignore these mutual fund schemes.

2) These mutual funds are meant to invest through SIP. Means you can invest as low as Rs 500 per month in such schemes. If you want to invest in a lump sum, you need to check for any stock market correction of over 1,000 points and invest them. Otherwise, these are not for lump sum investments.

3) These mutual fund schemes are meant for long term investment of 8-10 years. If you want to invest say for 3 years or 5 years, you may or may not get returns.

4) This list of 5 funds contain midcap and smallcap mutual funds also which are high risk. If you do not wish to invest in such high risk mutual fund schemes, you can ignore this portfolio.

5) We have filtered these funds based on SIP investment calculator as to which SIP gave highest returns. Preference is given to funds that gave highest SIP returns.

So, if you are moderate to high risk taker and wish you invest for long term in best mutual funds for SIP 2019, you can consider this list. If you are looking for Best SIP Plan for 1 year or for short term, skip this article.

Top 5 Mutual Funds for SIP in 2019


Let’s look at the list of 5 mutual fund schemes now.

#1 – ICICI Prudential Blue Chip Fund

Investment Strategy of the mutual fund

The MF seeks to generate long term capital appreciation and income distribution to investors from a portfolio that is predominantly invested in equity and equity related securities of large cap companies.

Performance and Ratios of the fund

This mutual fund scheme gave 13% annualized returns in the last 10 years, 8% annualized returns in the last 5 years and 7% annualized returns in the last 3 years.

If one would have invested Rs 1,000 per month through SIP for 5 years, the investment would have been Rs 60,000 (Rs 1,000 x 60 months) and the invested value would have now grown to Rs 72,000.

If one would have invested Rs 1,000 per month through SIP for 10 years, the investment would have been Rs 1.2 Lakhs (Rs 1,000 x 120 months) and the invested value would have now grown to Rs 2.2 Lakhs.

Its current NAV is Rs 39.71.

This fund has a beta of 0.83 and Alpha of -1.68. Investors should invest in mutual fund schemes that has beta of <1 and positive alpha for low risk and high returns. Due to recent market corrections, alpha is negative for this scheme.

Why to invest?

This is one of the consistent performing blue chip mutual fund schemes in the last 10 years that gave 13% annualised returns. This fund was rated by Value Research Online as 5 Star Fund (5 out of 5 and Higher is better) and Crisil as Rank-2 (2 out of 5 and lower is better). Its low beta protects from any downside from volatile markets. Considering these factors, this is one of the Top 5 Mutual Funds for SIP to invest from the large cap segment. Many mutual fund experts are recommending this fund as Best SIP Plan for 15 years or 20 years. 

#2 – SBI Focused Equity Fund


Investment Strategy of the mutual fund

The MF seeks to provide the investor with the opportunity of long-term capital appreciation by investing in a concentrated portfolio of equity and equity related securities.

Performance and Ratios of the fund

This mutual fund scheme gave 17% annualized returns in the last 10 years, 11% annualized returns in the last 5 years and 8% annualized returns in the last 3 years.

If one would have invested Rs 1,000 per month through SIP for 5 years, the investment would have been Rs 60,000 (Rs 1,000 x 60 months) and the invested value would have now grown to Rs 76,000.

If one would have invested Rs 1,000 per month through SIP for 10 years, the investment would have been Rs 1.2 Lakhs (Rs 1,000 x 120 months) and the invested value would have now grown to Rs 2.6 Lakhs.

Its current NAV is Rs 133.72.

This fund has a beta of 0.88 and Alpha of 2.31. Investors should invest in mutual fund schemes that has beta of <1 and positive alpha for low risk and high returns.

Why to invest?

This is one of the best performing multicap mutual fund schemes in the last 15 years that gave 19% annualized return since inception. This fund was rated by Value Research Online as 5 Star Fund (5 out of 5 and Higher is better) and Crisil as Rank-1 (1 out of 5 and lower is better). Its low beta protects from any downside from volatile markets. Higher beta provides high returns in bull market. Considering these factors, this is one of the Top 5 Mutual Funds for SIP to invest from the multi-cap segment.

#3 – HDFC Midcap Opportunities Fund


Investment Strategy of the mutual fund

The scheme seeks to provide long-term capital appreciation/income by investing predominantly in Mid-Cap companies.

Performance and Ratios of the fund

This mutual fund scheme gave 17% annualized returns in the last 10 years, 10% annualized returns in the last 5 years and 3% annualized returns in the last 3 years.

If one would have invested Rs 1,000 per month through SIP for 5 years, the investment would have been Rs 60,000 (Rs 1,000 x 60 months) and the invested value would have now grown to Rs 66,000.

If one would have invested Rs 1,000 per month through SIP for 10 years, the investment would have been Rs 1.2 Lakhs (Rs 1,000 x 120 months) and the invested value would have now grown to Rs 2.5 Lakhs.

Its current NAV is Rs 48.25.

This fund has a beta of 0.91 and Alpha of -0.10. Investors should invest in mutual fund schemes that has beta of <1 and positive alpha for low risk and high returns.

Why to invest?

This is my favorite midcap mutual fund scheme. It is one of the good midcap mutual fund schemes in the last 12 years that gave 14% annualized returns since inception. This fund was rated by Value Research Online as 4 Star Fund (4 out of 5 and Higher is better) and Crisil as Rank-3 (3 out of 5 and lower is better). Its low beta protects from any downside from volatile markets. Considering these factors, this is one of the Top 5 Mutual Funds for SIP to invest from the midcap segment. We have recommended this fund in our Top 10 Mutual Funds for SIP to invest in 2019 article published earlier too. 

#4 – SBI Smallcap Mutual Fund


Investment Strategy of the mutual fund

The MF scheme seeks to provide investors with opportunities for long-term growth in the capital along with the liquidity of an open-ended scheme by investing predominantly in a well diversified basket of equity stocks of small cap companies.

Performance and Ratios of the fund

This mutual fund scheme gave 17% annualized returns in the last 10 years, 17% annualized returns in the last 5 years and 10% annualized returns in the last 3 years.

If one would have invested Rs 1,000 per month through SIP for 5 years, the investment would have been Rs 60,000 (Rs 1,000 x 60 months) and the invested value would have now grown to Rs 75,000.

If one would have invested Rs 1,000 per month through SIP for 10 years, the investment would have been Rs 1.2 Lakhs (Rs 1,000 x 120 months) and the invested value would have now grown to Rs 3.2 Lakhs.

Its current NAV is Rs 47.42.

This fund has a beta of 0.86 and Alpha of 8.62. Investors should invest in mutual fund schemes that has beta of <1 and positive alpha for low risk and high returns.

Why to invest?

It is one of the Top performing smallcap mutual fund schemes in the last 10 years that gave 17% annualized returns since inception. This fund was rated by Value Research Online as 5 Star Fund (5 out of 5 and Higher is better) and Crisil as Rank-2 (2 out of 5 and lower is better). Its low beta protects from any downside from volatile markets. Higher beta provides high returns in bull market. Considering these factors, this is one of the Top 5 Mutual Funds for SIP to invest from the small-cap segment.

#5 – HDFC Hybrid Equity Fund


Quick Overview

The Scheme seeks to generate capital appreciation / income from a portfolio, predominantly of equity & equity related instruments

Performance and Ratios of the fund

This mutual fund scheme gave 15% annualized returns in the last 10 years, 9% annualized returns in the last 5 years and 7% annualized returns in the last 3 years.

If one would have invested Rs 1,000 per month through SIP for 5 years, the investment would have been Rs 60,000 (Rs 1,000 x 60 months) and the invested value would have now grown to Rs 68,000.

If one would have invested Rs 1,000 per month through SIP for 10 years, the investment would have been Rs 1.2 Lakhs (Rs 1,000 x 120 months) and the invested value would have now grown to Rs 1.8 Lakhs.

Its current NAV is Rs 50.79.

This fund has a beta of 0.84 and Alpha of -0.57. Investors should invest in mutual fund schemes that has beta of <1 and positive alpha for low risk and high returns.

Why to invest?

If you are looking for Best SIP Plan for 20 years, this could fit into that. This hybrid mutual fund scheme is a consistent performer in the last 19 years that gave 15% annualized returns since inception. This fund was rated by Value Research Online as 4 Star Fund (4 out of 5 and Higher is better) and Crisil as Rank-2 (2 out of 5 and lower is better). Its low beta protects from any downside from volatile markets. Considering these factors, this is one of the Top 5 Mutual Funds for SIP to invest from the hybrid/balanced mutual funds segment. Some people believe that hybrid fund are Best SIP plans for 1 year (short term), however this is mis-conception as they invest majorly in equity and some portion in debt segment. 

List of Top 5 Best SIP Plans for 2019


List of Top 5 Mutual Funds for SIP to invest in 2019 - Diversified portfolio

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Suresh

Top 5 Mutual Funds for SIP to invest in 2019

17 comments

  • Jetli Raghu

    Can you please suggest what one should do if holding absl small cap and absl pure value for 3yrs ?and now negative returns and both funds are at bottom of the respective category….should one switch to some other fund of same category? like axis smallcap?

    I can hold but would those 2 funds ever outperform category?

    • Hi Jetli, Most of the mutual funds are in negative for the past 1-2 years. You need to hold them for atleast 1-2 years to turn them positive. As I always indicate, invest in mutual funds for long term of 8-10 years.

      • Jetli Raghu

        Thank you Suresh Sir,

        Yes, my horizon is long but concern is over my fund selection. due its worst performance across its small cap category, such that at the bottom in terms of returns across all small cap funds. It is also well below its small-cap benchmark returns

        So as per me, it has long way to turn around. Does ABSL small cap fund has still left a potential to do so? OR investor should switch to other well performing small cap funds?

        Please review this fund and share your views so it can help people like me.

        Thanks in advace

        • This fund had good track record. However due to SEBI recategorization of mutual fund schemes, fund managers are restricted to invest in large cap funds. Hence midcap/smallcap mutual funds are taking huge beating. This trend would continue for some more time before they bounceback. Pls have patience

          • Jetli Raghu

            Thank you suresh sir,

            So ABSL small cap fund can perform better when overall small/mid space bounce back, I will continue my SIP in it.

            Thanks again.

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