What Are The Best Mutual Funds For SIP In 2018?

Best Mutual Funds For SIP | Image Resource: freepik.com

Due to the ongoing internet penetration and ease of buying mutual funds online through your handheld or desktop device, mutual funds are so common these days. As a result, the demand for mutual funds is increasing day by day, and SIPs have made it easy to look at the equity schemes which have helped investors multiply their investment over a period of time. For this reason, it is important to go for such effective schemes.

However, in current market where FD rates are daily depreciating and you need huge amounts when it comes to investments like gold and property, you can start investing into mutual funds with as low as five hundred rupees a month.

However, not everyone has intellect or time to research what are best mutual funds for SIP so here we present you with a list of best mutual funds for SIP in the year 2018. One could categorize the mutual funds for SIP investments into three categories -- conservative, moderate and aggressive. As per market research there are generally three baskets in which investor for mutual fund fall, they are two thousand to five thousand rupees, five thousand to ten thousand rupees and above ten thousand rupees when they consider creating a portfolio.


How to find the best mutual funds for SIP?

The financial institutions or investment gurus apply very easy methodology to find out the best mutual funds. You can also read and learn about this and try to adopt it for your own personal research. They imply below parameters to calculate the proficiency of performance of any mutual fund for SIP.

• Consistency maintained during the last three years - Here the three-year period is divided into smaller timelines and each timeline progress is weighted.
• What is its downside risk that has negative returns?

This is calculated as below -
X - Returns below zero
Y - Sum of all squares of X
Z - Y divided by number of days taken for computing the ratio

Downside Risk = Square root of Z

• How many times it has outperformed than its expected performance in the market,
• And what is the size of the asset- the threshold asset size for diversified funds is hundred crore, and for balanced funds, it is fifty crore.

Mutual Funds are subject to market risk and you must research well before investing into them.