I want to start investing in mutual funds through SIP. Which is the best mutual fund to invest in? This is the most commonly asked question by the new investors, so hello and welcome to the blog where we talk about the basics of investing and personal finance. So, addressing the frequently asked question in today’s blog, we are going to talk about the five equity mutual funds, where you can begin investing by systematic investment plan (SIP) in the year 2025. These funds have been consistently performing well in the long term, not only in terms of returns but also in terms of managing the risk of volatility. The five funds we have taken out belong to five different categories, namely large cap, midcap, small-cap, large and midcap, and flexi cap funds, so while discussing the best fund in each of these categories. Moving forward, let’s quickly begin with the best funds to start SIP in the large gap category now.
Large Cap Fund:
Large-cap funds invest in the country’s 100 largest companies so these funds have to necessarily invest at least 80% of their Assets in large-cap companies while the remaining 20% can be invested in mid-small-cap stocks or debt they are idle for investors who want to go for Equity Funds but are not comfortable with too much risk of midcaps and small caps so they are suitable choice for conservative Equity investors and the best large Cap Fund to start sip in 2025 is Canara Robeco Bluechip Equity Fund – Regular Plan – Growth managed by fund manager Mr. Vishal Mishra, it holds assets worth 14579 cr it has delivered a 7-year rolling return of 13.42% now to give you some idea of how much money this fund made for its investors as well.
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If you had invested 1 lakh rupees in it five years ago, you would have gotten an amazing 2.43 lakh today. If you had been investing 10,000 rupees per month via SIP for the last ten years, you would have invested a total of 12 lakh rupees, and your money would have grown to a massive 30.34 lakh. Other investment options are moving on to the Best Mid Cap Fund.
Best Mid Cap Fund:
Now Midcap funds are the ones that invest in midsized companies that rank from 101 to 250 in terms of their market capitalization. Now, in simple terms, market capitalization means the size of the company. These funds tend to generate higher market-beating returns in the long term; they have historically outpaced inflation if invested for the long term, but they carry higher risk as well. You can expect these funds to falter during tough market conditions, so they are suitable only for aggressive investors who are ready to invest for a long term of at least 7 years or higher, and the best midcap fund to invest in by SIP is EdelWeiss Mid cap Fund. It manages assets worth 8,268.27 crores and has delivered a 7-year rolling return of 18.71%, so 1 lakh rupees invested in it. 5 years ago would have become 3.8 lakh today, and an SIP of 10,000 rupees per month for 10 years would have grown your 12 lakh rupees to 41 lakh 66,000 by now.
Best Large & Mid Cap:
Best Large & Mid Cap Fund suggests they invest in a combination of large and midcap companies of the country with a minimum of 35% of their assets.
Each in large-cap and mid-cap stocks. Now who should invest in them? Well, you need an aggressive risk profile to invest in equity funds. If you are not comfortable with pure mid-cap funds but don’t want to go as conservative as large-cap funds, this category may be a good choice. The mandatory 35% allocation to midcaps can boost long-term returns, while large-cap exposure reduces risk compared to pure midcap funds, and the best large and midcap fund on our list is the Quant Large and Mid Cap Fund Direct Growth, with assets worth 3700 CR and a stunning performance with a 7-year rolling return of 16.18 per. If an investor had invested 1 lakh in this fund 5 years ago, the money would have grown to a gigantic 3.41 lakh rupees, and a 10,000 rupee monthly SIP started 10 years ago would have given you a huge corpus worth 36.82 lakh now. The next in line is the small-cap fund.
Best Small Cap Fund:
Small-cap funds invest in companies that are ranked 251 and below in terms of their market capitalization, so these funds have to necessarily invest at least 65% of their assets in small-cap companies, while the remaining can be invested in large caps, mid-caps, or debt. Now understand this: as the small-cap funds invest in small-sized companies, you can expect a lot of volatility in them. Small-cap funds are like a wild roller coaster in the investing world, and they are not the best choice for beginners, so go for these funds only if you are a very aggressive investor and you understand the risks of investing in small companies well. Also, you should have at least seven years in hand if you want to invest in them. Coming to the best small cap Fund to invest by a systematic investment plan in the Nippon India Small Cap Fund. It is also the largest fund in the small-cap space, holding assets worth over 57,009 managed by the fund manager Samir Rachh. It has delivered a 7-year rolling return of an amazing 22.9%. So had you invested 1 lakh in this fund 5 years ago, your money would have become almost five times that, that is, 4.9 lakh rupees, and a 10,000 rupee monthly SIP started 10 years ago where you would have invested 12 lakhs would have grown to a massive corpus of 51.2997.
Best Flexi Cap Fund:
Best Flexi Cap Fund has to invest at least 65% of their portfolio in equities. Now, this can be across companies of any market capitalization, be it large caps, mid caps, or small caps in any proportion. This gives fund managers the flexibility to change portfolios in line with market dynamics. The remaining 35% can be invested anywhere at the discretion of the fund manager. Now, since flexi cap funds invest across companies of various sizes and sectors, they offer a diversified portfolio, so anyone who wants to invest in Diversified Equity Funds for long-term goals, which are at least 7 years away, may opt for flexi cap funds, and the best flexi cap fund to invest in via SIP is investors favorite, Parag Parikh Flexi Cap Fund Direct Growth is managed by Rajiv Thakkar, one of the most reputed fund managers. The fund has delivered 7-year rolling returns of 17.95% and is also the largest fund in the category with over 84,000 CR assets under management. If you had invested 1 lakh rupees in this fund 5 years ago, your money would have more than tripled to 3.21 lakh rupees, and a 7-year SIP of 10,000 rupees per month, where you would have invested a total of 840,000, would have grown to a massive 19 lakh 87,000 rupees. So I hope this post will help you begin your investment journey in mutual funds via a systematic investment plan.
If you have any questions, do let us Know in the comments, and we’ll see you with another insightful post soon. Mutual fund investments are subject to market risks. Read all scheme-related documents carefully.
Research and edit by Ankit Kumar and khushal oza
Such a great explain.