Mutual Fund SIP Investment: By continuing SIP for a long time, investors get tremendous benefit of compounding. In this, the investor can choose the scheme, investment amount keeping in mind his financial goal.
Mutual Fund SIP Investment: Mutual Fund SIP is such an investment option, through which you can get equity-like returns even from regular small savings. If you make a habit of investing your small savings every month, then you can easily build a corpus of lakhs of rupees in the next few years. By continuing the SIP for a long time, investors get tremendous benefits of compounding. In this, the investor can choose the scheme, investment amount keeping in mind his financial goal. Experts say that systematic investment is better for retail investors in the long term.
SIP: How much investment for 1 crore fund in 10 years
According to the SIP calculator, if you have set a target of creating a corpus of 1 crore in 10 years, then you will have to do a monthly SIP of around Rs 40,000. Many funds have given an average annual return of 14 per cent over a 10-year period. In this way, 40 thousand monthly SIPs can create a fund of 1 crore in 10 years at an average return of 14 per cent. In this, you will have an investment of Rs 48 lakh and an estimated wealth gain of Rs 56.8 lakh. However, if the annual average return is 12 per cent, then your corpus will be around Rs 93 crore.
In the last 10 years, there are many funds like Motilal Oswal Midcap 100 ETF, ICICI Pru Sensex, Nippon Ind ETF Junior, ABSL Nifty ETF, which have average SIP returns of 14 per cent.
What do experts say on SIP?
Deepak Jain, Head (Sales) Edelweiss Asset Management Limited Fund (EAML) says, “SIPs have given good returns to retail investors in the long term. In this, investors invest in a disciplined manner. Also, there is less exposure to volatility. Retail investors are preferring SIPs for regular investment. Whereas, for lump sum investment, you are opting for Balanced Advantage Funds or Dynamic Funds. This shows that the focus of investors is not just on returns but on risk-adjusted returns. SIP is a better option for this.
(Disclaimer: SIP calculation figures here are approximate. Not investment advice. Investing in Mutual Funds is subject to market risks. Please consult your advisor before investing.)
