Whether SIP of 1 year in MF will give good returns after 8 years ?

POSTED BY Yogesh K ON April 4, 2012 6:38 pm COMMENTS (7)

I will be investing 1 lakh per year in PPF. After that I plan to do invest of Rs. 10000 per month (as SIP) in Mutual Fund for 6 years and additional Rs. 6000 per month (as SIP) in Mutual fund but only for 1 year. From the views different experts have shared in this forum, I have shortlisted following few funds where I am thinking to invest this amount
1) Franklin India Bluechip
2) BSL Dividend Yield Plus
3) HDFC Top 200
4) HDFC Prudence
5) IDFC Premier Equity Plan A
6) DSP BlackRock Top 100

I am confused whether to invest equally in each fund. Another point is in which fund to invest for only 1 year and in which funds to invest for 6 years. I do not plan to withdraw any money which is invested in these funds for next 8 to 10 years. So considering this scenario, I would like opinion about whether it is worth to invest in mutual fund and if yes then how should be the distribution?

Thanks

-Yogesh

7 replies on this article “Whether SIP of 1 year in MF will give good returns after 8 years ?”

  1. Yogesh K says:

    No. any money which I am investing will not be used for house/plot purchase. As I have mentioned once I put money in MF I will think to withdraw after 8-10 years.

    -Yogesh

    1. Dear Yogesh, please invest in the same funds where you ‘ll invest long term SIPs. To differentiate for these 1Y SIP, please invest on a different date.

      Thanks

      Ashal

  2. Yogesh K says:

    I have taken care of energency fund, term insurance, mediclaim. I own one house without any loan. I am 37 yrs old and I am medium risk taker. For this one year I have some money which I can invest. In the next year I plan to buy second home (or plot). That is why I am thinking to have 1 year MF investment in between as I may not be in a position to continue it once I purchase house or plot in the next year. Well, if I drop that plan I may continue investment in MF. Most of the members in this forum have expressed view that long term SIP investment in MF gives good returns, So for some funds I plan to invest for 5-6 years. I have query that if I do SIP only for one year and withdraw that money after 8-10 years whether it can give good returns or it will be better to put money in long term bank FD.

    1. Dear Yogesh, this 1Y money is to be used for that house/plot purchase or not? from your query, I’m unable to understand.

      Please clarify.

      Thanks

      Ashal

  3. Dear Yogesh, why do you want to invest for 1Y only in some funds & continuous investments in some funds? Any logic, please clarify.

    Thanks

    Ashal

  4. TheZionView says:

    Yogesh

    You don’t have to have different set of funds. You might consider this suggestion but i am giving it without knowing you risk taking ability and any other detail of yours so it might not be right for you.

    1) Franklin India Bluechip SIP 3000 + 3000(1 year SIP)
    2) HDFC Top 200 SIP 2000
    3) IDFC Premier Equity Plan A SIP 2000
    4) Quantum Long Term Equity SIP 2000 +3000(1 year SIP)

    I assume you have taken care of rest of your basic checklist of financial planning like

    Emergency Fund
    Term Insurance
    Health Insurance

  5. Yogesh,

    i dont understand the logic behind 2 MF for 1 year and other for 6 years. I would have avoided Birla dividend plus and HDFC Prudence. You already investing 1 lakh in ppf that will conver your debt portion.

    All other funds seem to be good.

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