Making smart investments is crucial for securing one’s future in the ever-changing financial environment of today. Investing in mutual funds has become more disciplined and popular with the introduction of Systematic Investment Plan (SIP). Over time, a large number of investors seeking steady returns have been drawn to them due to their capacity to handle market volatility while providing the advantages of compounding. We will examine the subtleties of choosing the optimal Best SIP Plan for 5 years investment horizon in this guide, highlighting important elements and factors.
10 Best SIP Plan for 5 years in India 2023
|Funds||5-Year SIP Returns (%)*|
|Quant Small Cap Fund||31.34|
|Quant Infrastructure Fund||27.08|
|Quant Tax Plan||23.99|
|Nippon India Small Cap Fund||23.93|
|ICICI Prudential Infrastructure Fund||23.36|
|Quant Flexi Cap Fund||22.79|
|Quant Mid Cap Fund||22.60|
|Quant Multi Asset Fund||22.46|
|SBI Contra Fund||22.30|
|PGIM India Midcap Opportunities Fund||21.58|
Best SIP Plan for 5 years in Equity Funds
- Quant Small Cap Fund Direct Plan-Growth: Growth of the Quant Small Cap Fund Direct Plan is perfect for a person seeking a medium- to short-term investment. For instance, under the Quant Small Cap Fund Direct Plan-Growth, an investor may anticipate growth of 67.91% over a three-year period. The fund’s five-year growth rate is 22.49%.
- Tata Digital India Fund Direct-Growth: Tata Mutual Fund offers an equity mutual fund scheme called Tata Digital India Fund Direct-Growth. Meeta Shetty, the fund manager, is currently in charge of overseeing the plan. As of right now, the fund’s expense ratio is 0.31%. With INR 6,765.81 crores in AUM (Asset Under Management), it is an open-end fund.
- ICICI Prudential Technology Direct Plan-Growth: For three years, the ICICI Prudential Technology Direct Plan-Growth provides an average growth rate of 51.73%. Furthermore, it provides a 5 year rate of return of 21.60%. The minimum investment required to participate in the ICICI Prudential Technology Direct Plan-Growth is INR 100.
- SBI Technology Opportunities Fund Direct-Growth: The 36.75% rate of return in 3 years and the 20.84% growth rate in 5 years are offered by the SBI Technology Opportunities Fund Direct-Growth. To receive the highest returns, an investor can begin a SIP of INR 500 per month for at least three years. SBI Technology Opportunities Fund Direct-Growth has a total fund size of INR 2861.77 crores.
- Aditya Birla Sun Life Digital India Fund Direct-Growth: For more than a decade, Aditya Birla Sun Life Digital India Fund Direct-Growth has been in operation. The fund was established on January 1, 2013. INR 3,338.13 crores is the current asset under management of the Aditya Birla Sun Life Digital India Direct-Growth Fund. In three years, it will yield a 40.10% rate of return with an expense ratio of 0.88%.
Best SIP Plan for 5 years in Debt Funds
- DSP Government Securities Direct Plan-Growth: DSP Mutual Fund provides a Gilt mutual fund scheme called DSP Government Securities Direct Plan-Growth. The fund was established on January 1, 2013, and it has been around for more than ten years. This is a medium-sized fund with an expense ratio of 0.54%. A 5.88% rate of return in three years and an 8.34% rate of return in five years are provided by the DSP Government Securities Direct Plan-Growth fund.
- Aditya Birla Sun Life Medium Term Direct Plan-Growth: Birla Aditya The mutual fund scheme Sun Life Medium Term Direct Plan-Growth has a medium duration. It belongs to the medium-sized fund category and has assets under management of INR 1,643 crore. In three years, its rate of return is 14.17%, and in five years, it is 8.57%.
- Bandhan Government Securities Investment Plan Direct-Growth: The Government of India’s (GOI) securities are the primary holdings of the Bandhan Government Securities Investment Plan Direct-Growth. Since its inception, the plan has produced an average annual rate of return of 8.83%. Moreover, it manages assets valued at INR 1410 crores. In three years, the plan yields a 5.69% rate of return; in five years, it offers an 8.39% rate of return.
How to Select the Best SIP Plan for 5 years
- Identify Your Financial Goals: Choosing a SIP requires first determining your financial objectives. Are you saving for your child’s college education, buying a house, or investing for retirement? You can choose the kind of mutual fund to invest in based on how long the goal will take and how much money you need for it.
- Understand Your Risk Tolerance: Varying mutual funds have varying degrees of risk. For instance, compared to debt funds, which offer stable but generally lower returns, equity funds are riskier and can yield higher returns. Selecting the appropriate mutual fund category will be made easier if you are aware of your risk tolerance.
- Evaluate Fund Performance: Examine the mutual fund’s historical performance. Although historical performance does not guarantee future results, it can offer insight into the consistency of the fund.
- Check the Expense Ratio: The annual fee mutual funds charge you to manage your investments is known as the expense ratio. Over time, a high expense ratio may reduce your returns. Consequently, choosing a fund with a lower expense ratio is advised.
- Review the Fund Manager’s Track Record: The performance of the fund can be significantly impacted by a competent fund manager. Examine the fund manager’s background, performance history, and other funds under their management.
- Diversification: Select a fund that has a good level of industry and company diversification. Stabilizing returns and reducing risk are two benefits of diversification.
- Regularly Monitor Your SIP: Following your investment, it’s critical to periodically assess the performance of your SIP and make the required modifications in accordance with your evolving financial objectives or the state of the market.