Top 10 Best SIP Mutual Funds to invest in 2022

Top and Best SIP Mutual Funds to invest in 2022 in IndiaTop 10 Best SIP Mutual Funds to invest in 2022

It was an exciting journey for investors in 2021. Nifty 50 generated 24% returns and Sensex has generated 22.5% returns in last 1 year in 2021. There is increase in mutual fund SIP investments in 2021 compared to previous years. Mutual fund investors should always align their mutual fund investments with financial goals to reap the maximum benefit. Which are the Best SIP Mutual Funds to invest in 2022? Which are the Top 10 Mutual Funds that are consistent performers?

What are SIP Mutual Funds?

Skip this section if you are already familiar with mutual funds in India.

Mutual funds pool money from investors and invest in equity or debt or gold or silver or real estate etc., depending on the investment objective indicated in the scheme information document (SID).

Systematic Investment Plan (SIP) is a disciplined way of investing in mutual funds with equal amounts at predefined interval. This could be weekly SIP, fortnightly SIP, monthly SIP, quarterly SIP or yearly SIP. Among these various options, month SIP is popular.

There are over 800 mutual fund schemes (equity and hybrid) in India. In this bull run, majority of them are top performers. However, investors should pick-up mutual fund schemes based on some of the key parameters.

How to choose a good mutual fund suitable for you?

Mr. Rajesh has picked-up a small cap mutual fund scheme to invest for 3 years time frame to use this for his kids’ education. He checked last 3 years performance, excited about it and chosen this fund. He is low to moderate risk investor

Do you know whether Mr. Rajesh made the right choice? The answer is NO. Small cap mutual funds are high risk and should be invested only long term perspective.

Hence it is important to understand how to choose a right fund suitable to you.

#1 – Pick-up mutual fund based on your goal

If you need to achieve a specific financial goal, align your mutual funds also towards that.

E.g. You need money for kids’ education in next 5 year and need to accumulate an X amount in 20 years for retirement. Don’t club them. Consider two mutual funds which can align towards these 2 goals as one is medium term and another in long term in nature.

#2 – Invest based on your risk appetite

There are low risk, moderate risk and high risk investors. In above example, Mr. Rajesh is low to moderate risk investor, however, considered high risk fund. After a couple of years, he would have sold the mutual funds with loss and would have blamed that mutual funds are not fit for anyone.

Low to moderate risk takers – Invest only in debt funds

Moderate risk takers – Can consider balanced funds. However, they can add some portion of large cap funds and flexicap mutual funds. If markets are volatile, one can consider some of the best conservative hybrid funds too.

High risk investors – They can consider all types of funds like index funds, large cap funds, flexicap funds, small cap funds, mid cap funds and global funds etc.,

#3 – Pickup mutual fund based on tenure

This is one of the key aspects in choosing a SIP mutual funds. Investing in equity fund for short term could be a disaster. Align your mutual fund investments based on how long you can invest in such schemes.

Short term < 3 years – Only debt funds (irrespective of risk appetite). Check some of the consistent performing debt funds that generated over 7% every year in the last 8-10 years.

Medium term 3 to 5 years – Balanced funds could be better (irrespective of risk appetite)

Long term 5-10 years – Any mutual fund scheme

#4 – Past performance is key, but not sole criteria

Some people say past performance is irrelevant. But how do you judge a fund? Past performance can help you to know how such fund performed in various market cycles. However, don’t expect such fund can perform in similar line in future too. One should consider annualized returns + rolling returns when choosing a SIP mutual fund scheme for investing in medium to long term.

#5 – Low expense fund

There is good awareness being created across various blogs or a website or social media forums in the last few years. Investors have been shifting to direct mutual fund schemes where the expense ratio is low. This way the returns would be higher. Avoid investing in regular mutual fund schemes.

#5 – Consider tracking error in index funds

Index funds would replicate a particular index. This does not mean that every index fund can be considered for investment. If the fund do not track the exact replica of the index, there could be gaps in the returns generated by index vs. returns generated by the fund. The gap is tracking error. Lower the tracking error, better it is.

#6 – Size of the fund matter

Investors can consider a mutual fund scheme that has AUM of > 500 Crores. When they want to redeem they should not face redemption issue, hence this check point.

How did Top 15 Mutual Funds recommendation of last year perform?

We have been providing top 10 mutual fund recommendation every year. Let us check how 2021 mutual fund recommendations performed in the last 1 year

No Scheme Name 1 Year Return
#1 Mirae Asset Large Cap Fund 30%
#2 Axis Blue Chip Fund 25%
#3 SBI Blue Chip Fund 27%
#4 Canara Robeco Blue Chip Equity Fund 28%
#5 Mirae Asset Emerging Blue-chip Fund 40%
#6 SBI Small Cap Fund 43%
#7 Kotak Emerging Equity Fund Regular Plan 45%
#8 Axis Midcap 40%
#9 Axis smallcap 57%
#10 Kotak Standard Multicap Fund Regular Plan 27%
#11 Parag Parikh Flexicap fund 46%
#12 UTI Equity fund 34%
#13 SBI Equity Hybrid Fund 24%
#14 HDFC Hybrid Equity Fund 27%
#15 Canara Robecco Equity Hyrbid fund 25%

Top 10 Best SIP Mutual Funds to invest in 2022


Now that we understood how to pick-up a mutual fund scheme and also seen how our last year recommended funds performed, here is the list of 10 best mutual funds to invest through SIP in 2022 in India.

For easy differentiation, these are categorized into Largecap, Flexicap, Midcap/Smallcap, Balanced Funds and Global Funds.

One should note that there are 800+ equity and hybrid mutual fund schemes and hundreds of top performing mutual funds. We filtered funds which are consistent performers. The list can be bigger if we consider top 20 or top 30 funds or top 30 funds.

Best Largecap / Index Funds to invest in 2022

We have considered 4 funds in this category now for 2022.

We have added 2 index funds (Nifty index fund and Nifty Next 50 index funds as part of 10 SIP mutual funds of 2022). Investors are moving into passive index funds in the last few years. Instead of worrying about which fund would be performing better, one can go for such index funds. This way, if the stock market is up, your investment is up and no need to worry about fund performance.

We have retained 2 large cap funds which we recommended earlier.

These funds have generated consistent annualized returns as well as rolling returns in the last 5 years.

If you are moderate to high risk taker and willing to invest for 5-10 years and above, you can invest in these funds. Yes, there could be overlap in terms of underlying stocks, but don’t invest in single fund which can screw up your portfolio.

Here is the list of best large cap / index mutual funds to invest in India.

#1 – UTI Nifty Index Fund

#2 – UTI Nifty Next 50 Index Fund

#3 – Mirae Asset Large Cap Fund

#4 – Axis Blue Chip Fund – This is one of our favorite fund.

Navi Mutual Fund is disrupting mutual fund industry with lowest expense ratio. It has recently launched Navi Nifty Next 50 Index Fund NFO which has low expense ratio at 0.12%. Earlier HDFC MF and UTI MF also had low expense ratio for some of their index funds, however they have increased the expense ratio last year.

Best Midcap and Smallcap Funds to invest in 2022

We have retained our earlier recommendation and considered 1 Midcap and 1 small cap fund for 2022.

These Midcap and small cap funds have generated consistent annualized returns as well as rolling returns in the last 5 years.

If you are a high risk investor and willing to invest for 8-10 years, you can consider investing some of your portfolio in such funds.

Here is the list of Top Midcap and Smallcap SIP mutual funds to invest in 2022.

#1 – SBI Small Cap Fund

#2 – Axis Midcap Fund

Best Flexicap Funds to invest in 2022

We have retained our earlier recommendation and considered 2 flexicap funds.

These top flexicap mutual funds have generated consistent annualized returns as well as rolling returns in the last 5 years.

If you are moderate to high risk investor and willing to invest for 5-10 years and above, you can consider investing in such funds.

Here is the list of Top Flexicap mutual funds to invest in 2022.

#1 – Parag Parikh Flexi Cap fund

#2 – UTI Flexi Cap fund

There are many new entrants in mutual fund industry (e.g. Samco MF). Recently Samco Flexicap Fund was launched. One need to wait and watch how such funds perform in short to medium term.

Best Hybrid Funds to invest in 2022

We have retained our earlier recommendation and considered 1 hybrid fund now – Canara Robeco Equity Hybrid fund.

This hybrid fund has generated consistent annualized returns as well as rolling returns in the last 5 years.

If you are moderate risk investor and willing to invest for 5+ years, you can consider investing in such hybrid funds.

Best International Funds to invest in India

While we have recommended global funds in various other articles, we are now making this part of the top 10 funds from this year onwards. This would work like a diversification to your portfolio with global exposure.

The fund we are recommending in international mutual fund category is Motilal Oswal Nasdaq 100 Fund of Fund.

This global fund has generated consistent annualized returns as well as rolling returns in the last 5 years.

If you are a high risk investor, willing to invest for 5+ years and looking for global exposure, you can consider investing in such funds.

List of Top 10 Best SIP Mutual Funds to invest in 2022


Category Mutual Fund Scheme 1yr 3yr 5yr
Index / Largecap UTI Nifty Index Fund 27.0% 20.0% 18.0%
UTI Nifty Next 50 Index Fund 26.0% 23.0% 16.0%
Mirae Asset Large Cap Fund 28.0% 19.0% 18.0%
Axis Bluechip Fund 24.0% 21.0% 21.0%
Mid-cap
Small-cap
SBI Small Cap Fund 43.0% 29.0% 24.0%
Axis Midcap Fund 40.0% 28.0% 25.0%
Flexicap Parag Parikh Flexi Cap fund 46.0% 21.0% 24.0%
UTI Flexi Cap fund 34.0% 27.0% 23.0%
Hybrid Canara Robeco Equity Hybrid fund 25.0% 20.0% 17.0%
Global Motilal Oswal Nasdaq 100 Fund of Fund 27.0% 37.0%

(Returns are annualised)

Have you liked our tips and analysis? Then share it on your Facebook, Twitter, Telegram and other social media, which might be useful to your friends too.

Suresh KP

59 comments

  • Dilip Sahoo

    Dear Suresh,
    Thank you for such wonderful articles. Always helpful.

    Could you please review/advise on my current funds.

    Risk Profile – Moderate to High Risk. Time Horizon -10-15 years.

    ICICI Prudential Equity & Debt Fund – Direct Plan-Growth -3000
    SBI Equity Hybrid Fund – Direct Plan – Growth-3000
    HDFC Hybrid Equity Fund – Direct Plan-3000
    SBI BLUE CHIP FUND – Direct-Growth- 3000
    Mirae Asset Emerging Bluechip Fund – Direct Plan- 5000
    Kotak Flexi Cap Fund- Direct Plan- 3000
    Axis Bluechip fund Direct Plan-5000
    Mirae Asset Tax Saver Fund Direct Growth-5000 ( for tax saving)
    ——————————————————————————————————
    My Spouse is investing in the below funds. Risk Profile – Moderate to High Risk.
    Time Horizon -10-15 years

    Axis small-cap fund direct growth-2500
    SBI Small Cap Direct Plan-2500
    Mirae Asset Emerging Bluechip Fund – Direct Plan-2500
    Parag Parekh Flexi cap – Direct Plan-5000
    Tata Digital Fund- Direct Plan-5000 (Recently added, thinking IT will grow in coming years)

    Please share your thoughts on the above funds.

    Thank you and Stay Safe,

    Regards
    Dilip

    • Hello Dilip, Good to hear about you. You have good funds, however try to compress among categories. e.g. you have 3 hybrid funds. Reduce it to 1. Same way, in largecap you have couple of funds, reduce this to 1. Coming to your spouse portfolio, it is good, however it is risky portfolio. It contains 2 smallcap + 1 large-midcap + 1 sector fund (4/5=80%). If you are okay with this, fine, else try to reduce some high risk and move some to flexicap

  • Sir very knowledgeable but still I’m confused.I’m beginner I have little knowledge about mf.i want to invest sip in the index fund where should I invest and how to invest.its necessary to open trending account and demat account or I go directly to AMC for investment.there is any app I can use.plz guide me.thank you

    • Hello Lalbabu, Without understanding anything in mutual fund, do not jump into investing. First go through our mutual fund articles. Once you understand basics, you can open MF account at various portals like Groww or Kuvera and invest in direct mutual funds based on your financial goals, tenure of investment and risk appeitte.

  • Deepak verma

    It was a fantastic knowledge. Thanks a lot for it but pls provide more knowledge about stokes .

  • Ragini Shah

    Excellent reading on how to pick mutual funds.

  • Kiran

    I understand your analysis and I also do some H.W on you tube about this and conclusion is same as u described. But my question is I am a beginner I understand everything high risk moderate risk and low risk and sip plan . Kis ko kisme jana hai but my problem is how to invest where to invest how will I get return do I have to withdraw or it will auto credit? Which app will you prefer? Is there any charges to opening this account? How to open this account and what is demat account?
    Or if I want to invest one time amount of 50k for 3-5 years where should I go? I mean where I invest for safe guaranteed return!
    I know these are so many questions but I just got your article in my recommendation and go through and check that u answer many . Can you help me as beginning?

    • Hello Kiran, If you are beginner to mutual funds, you can register at Groww App or Kuvera App which are simple to use. You can always switch to any other mutual fund platform without any hassles. For 3 to 5 years, investing in equity could be riskier. If you still want to invest, you can consider hybrid fund indicated in my article. These would not give guaranteed returns.

Leave a Reply

Your email address will not be published. Required fields are marked *