Invest With Rs 500 in Mutual Funds SIP and Lumpsum

29 September 2022
5 min read

Mutual funds are the best way to invest your money. Mutual funds work like a collective pool of money for the investors who are investing in them. Mutual funds enable investors to invest their money in different stocks, bonds, and other financial instruments that help them earn higher returns on their investments.

With a mutual fund, you can choose from a wide range of investment options such as equity shares, debt issues, gold coins, bullion, etc., which will allow you to choose what type of investments you would like to make.

You can also choose the amount you want to invest each month so that it comes out of your pocket only when it is needed.

Mutual funds are top-rated among people who are looking forward to investing their money in something that can produce good returns over time without too much risk involved. They also provide an opportunity for people who have limited capital or even no capital at all because they allow investors to participate or share some percentage of their earnings based on how much they invested one year or five years ago

One of the primary benefits of mutual funds is the option to invest via a Systematic Investment Plan (SIP).  SIPs in mutual funds diversify an investor while also providing the benefits of rupee cost averaging. Hence, many investors look for options to invest in schemes with a minimum investment of Rs 100 and Rs 500. 

Top Performing Mutual Funds SIP and Lumpsum

S.No.

Mutual Funds SIP and Lumpsum

1.

Axis Small Cap Fund

2.

ICICI Prudential Small Cap Fund

3.

SBI Small Cap Fund

4.

Nippon India Growth Fund

5.

ICICI Prudential Bluechip Fund 

6.

Tata Large & Mid Cap Fund

7.

DSP Midcap Fund

8.

Nippon India Small Cap Fund

You can select either SIP or Lumpsum investment of these funds based on your investment objective and risk tolerance. 

Factors To Consider Before Choosing To Invest In Mutual Funds SIP and Lumpsum

Before you invest in mutual funds, it's essential to consider some factors.

  • Your Risk Appetite

Your risk appetite is the amount of money that you are willing to lose on an investment. It's a good idea to take a look at the average return of mutual funds, and compare it to your own investment goals. If you have a high-risk tolerance, then you can be more confident in investing in a higher-risk fund.

  • Your Investment Goals

Another important factor that you need to consider when investing in mutual funds is your investment goals.

If you want to make more profits over time, then it would be better to invest in equity funds than fixed income products like bonds and debentures because these types of plans offer better returns over long periods compared to equities or fixed income products like treasury bills which offer shorter term returns compared to equities or fixed income products.

  • Performance of The Plan You Are Choosing

Ensure your chosen plan has been around long enough for its performance record to be reliable. Investors need to be sure that the SIP they choose will perform as expected. Therefore, it is essential to look at the past performance of the plan you are considering and ensure it has delivered good returns over time.

  • Expense Ratio

The expense ratio is a percentage rate applied to all assets under management in a mutual fund. Your money will come back to you at this rate, plus any other charges. Therefore, when deciding whether or not a particular plan is right for you, it is essential to consider how much it costs and its performance statistics.

Top Funds: Overview

1) Axis Small Cap Fund

Axis Small Cap Fund Direct-Growth is an Equity Mutual Fund Scheme launched by Axis Mutual Fund. This scheme was made available to investors on 04 Sep 2009. The investment strategy of Axis Small Cap Fund - Direct Plan follows a bottom-up approach to stock selection. The fund aims to select promising small caps that have the potential to become successful long-term businesses. 

The scheme seeks to generate long-term capital appreciation from a diversified portfolio of predominantly equity & equity-related instruments of small-cap companies. You can select either SIP or Lumpsum investment of Axis Small Cap Fund Direct-Growth based on your investment objective and risk tolerance. 

2) ICICI Prudential Small Cap Fund

As the name suggests, ICICI Prudential Bluechip Fund invests in blue chip companies or well-established domain leaders with sound financials. In addition, the companies have a sustainable growth model and can weather economic setbacks.

The scheme seeks to generate long-term capital appreciation and income distribution to investors from a portfolio predominantly invested in large-cap companies' equity and equity-related securities.

3) SBI Small Cap Fund

SBI Small Cap Fund Direct-Growth is an Equity Mutual Fund Scheme launched by SBI Mutual Fund. This scheme was made available to investors on 29 Jun 1987. The scheme seeks to provide investors with opportunities for long-term capital growth along with an open-ended scheme's liquidity by investing predominantly in a well-diversified basket of equity stocks of small-cap companies. 

Investors with a moderately high-risk appetite, looking to park their money in an investment scheme for the long term, can consider this fund as a potential avenue.

4) Nippon India Growth Fund

Nippon India Growth Fund Direct-Growth is an Equity Mutual Fund Scheme launched by Nippon India Mutual Fund. This scheme was made available to investors on 30 Jun 1995. The scheme aims at the long-term growth of capital through a research-based investment approach. 

The term Expense Ratio used for Nippon India Growth Fund Direct-Growth or any other mutual fund is the annual charges one needs to pay to the Mutual Fund company for managing your investments in that fund.

5) ICICI Prudential Bluechip Fund

ICICI Prudential Smallcap Fund Direct Plan-Growth is an Equity Mutual Fund Scheme launched by ICICI Prudential Mutual Fund. This scheme was made available to investors on 12 Oct 1993. The minimum SIP Investment is set to ₹100. 

The scheme seeks to generate capital appreciation by predominantly investing in equity and equity-related securities of small-cap stocks.

Conclusion

Mutual funds are one of the most popular investment options in India. This is because they are easy to understand, simple to invest in, and can help you save up for retirement. In addition, mutual funds offer many benefits, including tax benefits and diversification.

Mutual funds should be an essential part of your investment portfolio. They are an excellent way to save for a specific period and then invest it in the stock market.

To read the RA disclaimer, please click here
Research Analyst - Bavadharini KS

Disclaimer

The stocks mentioned in this article are not recommendations. Please conduct your own research and due diligence before investing. Investment in securities market are subject to market risks, read all the related documents carefully before investing. Please read the Risk Disclosure documents carefully before investing in Equity Shares, Derivatives, Mutual fund, and/or other instruments traded on the Stock Exchanges. As investments are subject to market risks and price fluctuation risk, there is no assurance or guarantee that the investment objectives shall be achieved. NBT do not guarantee any assured returns on any investments. Past performance of securities/instruments is not indicative of their future performance.
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