Best SIP Funds - Top SIP Mutual Funds to Invest in 2024 (2024)

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Best SIP Funds is a list of hand-picked mutual fund schemes that have given better SIP returns compared to other Funds in the same category. This means these Funds stick to their investment philosophy in difficult times & aren't afraid of temporary correction in the prices of the Stocks in their Portfolios & hence generate better returns over the long term for their SIP investors.

Suitable if you are starting SIPs for your long-term investments of 5 years, 10 years or more

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Minimum: ₹ 1000

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List of Best SIP Funds in India Ranked by Last 5 Year Returns

Parag Parikh Flexi Cap Fund

EQUITY Flexi Cap

AUM

₹60,559 Crs

Min. Invest

₹1000

Current Value₹

Return (p.a)

+ 25.94% + 89.63% + 20.66% + 197.18% + 34.96% + 9.02% + 23.49% + 40.59% + 26.74% + 3.87% + 31.08% + 33.99% + 36.72% + 18.75% + 38.65% + 2.63%

Min. Invest

₹1000

#1 of 23 in Flexi Cap ETM Rank #1 of 23 in Flexi Cap

ETM Rank #1 of 23 in Flexi Cap

Expense Ratio 0.57%

Age 10+ yrs

Invest

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Canara Robeco Bluechip Equity Fund

EQUITY Large Cap

AUM

₹12,578 Crs

Min. Invest

₹1000

Current Value₹

Return (p.a)

+ 19.78% + 63.49% + 16.65% + 139.39% + 30.32% + 7.91% + 18.09% + 30.45% + 21.65% + 3.19% + 23.6% + 25.49% + 29.12% + 15.01% + 26.69% + 1.9%

Min. Invest

₹1000

#2 of 25 in Large Cap ETM Rank #2 of 25 in Large Cap

ETM Rank #2 of 25 in Large Cap

Expense Ratio 0.48%

Age 11+ yrs

Invest

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Quant Active Fund

EQUITY Multi Cap

AUM

₹8,732 Crs

Min. Invest

₹1000

Current Value₹

Return (p.a)

+ 34.35% + 131.27% + 24.6% + 267.82% + 60.28% + 14.65% + 29.09% + 51.67% + 50.43% + 6.78% + 37.03% + 40.91% + 54.21% + 27.16% + 123.86% + 6.61%

Min. Invest

₹1000

#3 of 7 in Multi Cap ETM Rank #3 of 7 in Multi Cap

ETM Rank #3 of 7 in Multi Cap

Expense Ratio 0.71%

Age 11+ yrs

Invest

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Quant Large and Mid Cap Fund

EQUITY

AUM

₹2,110 Crs

Min. Invest

₹1000

Current Value₹

Return (p.a)

+ 33.32% + 125.78% + 22.68% + 231.5% + 80.76% + 18.79% + 35.84% + 65.77% + 63.59% + 8.24% + 46.3% + 51.94% + 71.01% + 34.97% + 113.62% + 6.22%

Min. Invest

₹1000

#3 of 21 in Large & MidCap ETM Rank #3 of 21 in Large & MidCap

ETM Rank #3 of 21 in Large & MidCap

Expense Ratio 0.75%

Age 11+ yrs

Invest

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Kotak Bluechip Fund

EQUITY Large Cap

AUM

₹7,901 Crs

Min. Invest

₹1000

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All About SIP or Systematic Investment Plan

What is SIP?
How SIP works?
Why Invest through SIP?
Tax Implications of SIPs

What is SIP?

A Systematic Investment Plan, more popularly known as SIP, is a convenient method to invest in mutual funds. Using SIP, you can invest a fixed amount - as small as Rs. 100 in a Mutual Fund scheme at regular intervals. In fact, you can take a call on how regularly you want to invest - it can be weekly, monthly, quarterly, or even annual.

To understand what is SIP more easily, you can compare it to EMI or Equal Monthly Installments that you pay on a loan. You take an EMI route because you cannot make a payment for a purchase in one go. So, you split that amount into monthly payments and pay off the amount. Similarly, SIP is a monthly route to invest.

The major difference between SIP and EMI is of course the fact that you have to pay an interest amount for the loan; whereas, through SIP, you are investing and earning returns.

How SIP works?

A SIP is a very simple and flexible way of investing. In a SIP, a fixed amount of money is debited from your savings or current bank on a monthly or quarterly basis & invested in your chosen mutual fund scheme. Then a certain number of units of that particular mutual fund is allocated to you, based on the purchase price (or Net Asset Value, NAV) of the fund on that particular date.

Learn how to choose the right mutual fund

Why Invest through SIP?

The most important benefits of investing through the SIP route are:

You can start a SIP with a low amount of money: You can start a SIP investment with an amount as low as Rs.100, which makes it an ideal way for your first investment. It also spreads the risk over time rather than investing in a lump sum.
Automated investment brings discipline: Once SIP is set up, the amount is automatically deducted from your bank account and invested in a mutual fund of your choice. This eliminates manual intervention required for investment.
No need to time the market: Since this is a regular automatic monthly investment, there is no need of timing the market. Investment takes place irrespective of the market situation and money is invested in regular installments and at different pricing which helps in lowering cost. So, there is no need to worry about the market's ups and downs.
SIPs have total flexibility: SIPs provide complete flexibility on investment amount, choice of monthly and quarterly investing & tenure of investment. Moreover, you can skip an installment & cancel or modify your SIP investment whenever you want. There are no lock-in periods for the SIP route of investing.
Expert tip: Only Tax Saving Mutual Funds have a lock-in period of 3 years and not other MFs.
SIPs provide the benefit of Rupee Cost Averaging: When you invest a fixed amount of money every month in mutual funds through SIP, you keep investing irrespective of the market situation. This ensures that when the market falls, you get to purchase more units with the same amount of investment. Of course, when the prices rise, the same amount will purchase fewer units. This is called rupee cost averaging. This helps in doing away with the volatility in the market since it smoothes out ups and downs.
The averaging effect works out better when considered over an extended period since bear and bull conditions (positive and negative market situations) can last for long periods-even years, at times.
Expert tip: Rupee cost averaging is more likely to work over the long term. So, you need to continue your SIPs for the long term to reap maximum benefits.
SIPs help create wealth with small amounts: Systematic Investment Plans (SIP) help you to invest a fixed amount of money on a monthly basis which increases through market performance. This is where the power of compounding comes to play! It refers to the process of 'reinvestment of returns' the same at the same rate in order to grow the principal amount year after year.
Simply put, its return on returns + principal or 'earning income on the income'.
So, basically, the money invested works harder for you to grow your investment corpus and help you meet your financial goal.
Expert tip: Compounding works exponentially over time. So, the longer you remain invested, the better returns you will get with the power of compounding.

Tax Implications of SIPs

SIPs are no doubt the best way to invest in Mutual Funds , but before making your first investment knowing the tax implication is also important. However, the tax implications of different types of mutual fund schemes are different.

Although all gains from Mutual Fund investments are classified as Capital Gains, the sub-classification into Short-Term Capital Gains and Long-Term Capital Gains is based on the kind of fund and the duration of the investment.

If equity fund units are held for a tenure of more than 12 months, the gains generated are treated as Long Term Capital Gain (LTCG) for taxation. If the period of holding is less than 12 months, the gains are treated as Short-Term Capital Gains.

For debt funds, the units need to be held for a tenure of more than 36 months to qualify for LTCG taxation. Else the units qualify for Short Term Capital Gain (STCG) taxation.

Taxation of Equity-Oriented Mutual Funds:
- Long-Term Capital Gains (LTCG) are tax-free up to Rs.1 lakh every financial year
- Long-Term Capital Gains in excess of Rs.1 lakh per year are taxed at a flat rate of 10%
- Short-Term Capital Gains are taxed at 15%
Taxation of Debt Mutual Funds:
- Long-Term Capital Gains (LTCG) are taxed at 20% with indexation benefit
- Short-Term Capital Gains are taxed as per the investor's tax slab

How to Invest in a mutual fund SIP?

If you want to start a SIP in any mutual fund scheme, you can do so via ET Money's online portal or app in 4 easy steps:

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Login on ET Money app or website

Install and open the ET Money app on your mobile or login on ET Money website
Select the fund of your choice

Click on the "Find Funds" option to select the SIP fund you wish to invest in. Or you can directly search for it on the search bar at the top.
Choose mode and enter investment details

Select mode of investment as SIP and enter the installment amount, date and duration of the SIP.
Begin investing instantly!

Enter your bank details to set up bank mandate and automate payments using EasyPay.
After this, the amount of your SIP investment will be auto-debited from your account on the date of investment.

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Frequently Asked questions

Which SIP is best for 1 year?

For an investment horizon of up to 3 years, investors should only do a SIP in Debt Funds. Ultra Short Duration Funds can be a good alternative for a 1-year SIP.

Can I withdraw my sip anytime?

Yes, you can stop your SIP anytime and withdraw the invested amount - either in part or all of it. The only exception is tax saving funds like ELSS which comes with a lock-in period of three years from the date of investment. In ELSS, you will be able to withdraw your invested amount only after three years from the date of investment.

Should I invest lump sum or SIP?

By investing through SIP, you spread your investments over a period of time and avoid the risk of investing all your money at a time when the market is at its all-time high. You can invest a lump sum amount when there is a steep correction in the market like the one in March 2020. So, start a SIP and whenever you see a sharp correction, top it up with lump-sum investment.

What happens if we cancel sip?

When you cancel your mutual fund SIPs, the amount will stop getting debited from your bank account. The Mutual Fund company will not charge any penalty if you stop the SIP. The amount you have already invested will still remain invested in the fund and will continue to generate returns. You can withdraw the invested money - either in part or all of it - at any time.

Should I start sip when the market is high?

One of the biggest mistakes in investing is to try and predict the highs and lows of the market. What you think as a market high can just be the beginning of a big rally. This is why it is always a good time to start your SIP. By investing through SIP, you spread your investments over a period of time and average out the ups and downs in the market.

Which SIP is best for 10 years?

An investor can start a SIP in ELSS Funds. These funds help you save taxes as you can claim the investment amount as a tax deduction under Section 80C.

If tax saving is not the priority, then Flexi Cap Funds can be considered. These funds also invest in companies of all sizes and across sectors. So you get a diversified portfolio which helps to keep risk in check.

Is SIP good for the long term?

Yes, definitely. Investing through SIP makes you a disciplined investor, as you invest on a regular basis. Because of this disciplined approach, you are better placed to deal with market volatility. You get more units for the same investment amount when the markets go down. This helps bring down your average cost and when markets rebound you get higher returns due to this lower cost.

What is the average return in SIP?

SIP is a mode of investing in mutual funds and not an investment tool in itself. So you can start SIP in any of the mutual fund schemes that you want to invest in and the returns will depend on the performance of that mutual fund scheme.

How long can we invest in SIP?

You can invest in SIPs as long as you want. There is no upper limit on it. Ideally, you should start a SIP with a goal in mind. Set a target amount that you would require to fulfill that goal and continue the SIP till you reach that target.

Best SIP Funds - Top SIP Mutual Funds to Invest in 2024 (2024)

Browse our hand-picked categories

List of Best SIP Funds in India Ranked by Last 5 Year Returns

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All About SIP or Systematic Investment Plan

How to Invest in a mutual fund SIP?

Login on ET Money app or website

Select the fund of your choice

Choose mode and enter investment details

Begin investing instantly!

Frequently Asked questions