As we begin to usher in the year 2022, it maybe time to rejig your SIP portfolio and look at equity mutual fund schemes that can perform. Here are three SIP schemes that we have taken based on high ratings from CRISIL.
A word of caution
Before we tell you the names of the mutual fund schemes with high ratings, it is important to understand that we have picked the three schemes based on high ratings from CRISIL. At this time, the Sensex and the Nifty looks over priced and any fall in the markets could adversely impact your portfolio. The markets are not attractive at the moment and hence investors should only look to invest in SIPs and avoid investing lumpsum amounts.
The high ratings, are not a guarantee of superlative performance in the future and are only pointers on what could be better investment bets.
PGIM India Hybrid Equity Fund
This is an aggressive hybrid fund that has been rated 5-star by CRISIL. These type of hybrid funds tend to generate capital appreciation and income from a portfolio of equity and equity related securities as well as fixed income securities. Almost, 65 to 80% of the funds are deployed in equity and related instruments.
One of the reasons that we are recommending a hybrid fund is that the fund manager can move money from debt to equity when he sees that the markets have risen sharply. PGIM India Hybrid Equity Fund has generated returns of 22% in the last 1 year, while the 5-year returns have been 11% on an annualized basis. Almost 73% is invested in equities and the balance has been invested in debt instruments.
IDBI India Top 100 Equity Fund
IDBI India Top 100 Equity Fund has also been rated as 5-star by CRISIL. Unlike, PGIM India Hybrid Equity Fund, this fund is a largecap fund, whereby the fund manager places all of the money in large cap stocks.
The fund has very small assets under management to the tune of Rs 560 crores and hence is not a very big fund. IDBI India Top 100 Equity Fund has generated returns of nearly 30% in the last 1-year and 11.65% annualized returns over the last 5-years.
The fund has holdings in stocks like HDFC Bank, Reliance Industries, ICICI Bank and Infosys among others. As indicated earlier, past track record does not always mean superlative performance in the future.
DSP Government Securities Fund
The scheme seeks to generate returns through investments in central government securities with maturity between one and 30 years. The fund has been rated as 5-star by CRISIL. Investors looking to invest in the DSP Government Securities Fund can do so through an SIP of Rs 500 every month. These types of funds that invest in government securities will give low returns. The returns of the fund has been 9.32% on an annualized basis in the last 3-years. Investors who are unwilling to take a risk can invest in these type of funds.
In short, these funds give nominal returns, but, are highly safe.