Best SIP portfolios in mutual funds to invest in October 2024: An in-depth guide

Investing in mutual funds with SIP is one of the most preferred investment methods for earning wealth steadily. And by October 2024, many investors will be very keen to know about the best SIP portfolios to grow their investments in the existing market scenario. In this article, we will identify the top-performing SIP portfolios, advantages, and how you can create your investment strategy according to your financial goals.

What is SIP?

This ensures that you invest a fixed amount of money in mutual funds at regular intervals, which is usually every month. It is, therefore, a disciplined approach to investing and certainly helps to reduce the volatility of markets through time diversification.

Why Invest in Mutual Funds via SIP in 2024?

What the market will be characterized by in 2024 would be all the economic uncertainties across the globe, spiking interest rates, and inflationary pressures. During such market volatilities, SIPs may be considered to invest without time-market understanding, and the averaged cost over time also guards one from sudden falls in the markets and benefits with long-term growth.

Top SIP Mutual Fund Portfolios for October 2024:

With a SIP portfolio, the investor has to make choices based on his risk appetite, view on a time horizon, and investment goals. As October 2024 approaches, consider the following best-performing mutual fund SIP portfolios.

1. Large Cap Mutual Funds

Large-cap funds are from blue-chip companies. They are very stable, predictable, and consistent in their returns over any given period. In the midst of huge market volatility in 2024, large-cap funds, by way of being conservative, should allow investors to sleep better at night.

Recommended Funds: HDFC Top 100, ICICI Prudential Bluechip Fund
Advantages: Lower risk, stable returns and the creation of long-term wealth
Risk Category: Low to Moderate

2. Mid Cap Mutual Funds

These are medium-sized companies with high growth opportunities. Although such funds may be volatile short-term much more, for long-term investments they can prove highly lucrative.
Recommended Funds: Axis Midcap Fund, DSP Midcap Fund
Advantages: High return potential compared to large-cap funds
Risk Category: Moderate to High

3. Small Cap Mutual Funds

Small-cap funds are ideal for aggressive investors who can foresee turbulence in the market for more returns. These funds invest in small-cap companies that offer an exponential growth multiplier in the long term.

Recommended Funds: SBI Small Cap Fund, Kotak Small Cap Fund
Benefits: High growth potential in the long term.
Risk Profile: High

4. Multi Cap Mutual Funds

Multi-cap funds allow for investment across large, mid and small-cap stocks. This ensures a lot of diversification. These funds are apt for investors who wish to have exposure to different market segments.

Recommended Funds: Parag Parikh Flexi Cap Fund, UTI Flexi Cap Fund
Benefits: Diversification, balanced risk-reward ratio.
Risk Profile: Moderate

5. ELSS (Equity Linked Savings Scheme)

ELSS funds generate tax saving under Section 80C and wealth creation along with these funds. These funds majorly invest in equities and hence have a lock-in period of three years.

Suggested Funds: Mirae Asset Tax Saver Fund, Axis Long Term Equity Fund
Benefits: Benefits of long-term capital appreciation with tax savings.
Risk Profile: Moderate to High

How to Choose the Right SIP Portfolio?

Right SIP portfolio: According to what is your financial goal, your risk appetite, and investment horizon. These are things you must know about:
1. Risk Appetite
All funds have different risk profiles. You can opt for large-cap or multi-cap if you cannot afford to take much risk. You might consider mid-cap or even small-cap, ELSS funds if you think you are ready for more risk.
2. Investment Horizon
The period for which you plan to invest matters. For long-term aims (over 10 years), equity-oriented funds, such as small-cap and mid-cap funds, are good. Large-cap and balanced funds are suitable for short-term goals.

3. Investment Goals
Specify your investment goals, if you have any: wealth creation, retirement planning, tax savings, etc. This helps narrow down the funds that best suit your needs.

Why Invest in SIPs in 2024?

1. Rupee Cost Averaging
For SIP investors, there is rupee cost averaging wherein more units are purchased when the price is low and fewer units when it is high, resulting in an overall lower average cost.

2. Compounding
The magic of compounding works more in favor of the SIP as reinvestment occurs of the returns to generate exponential growth over the long term.

3. Disciplined Investing
SIPs enforce discipline in terms of continuous investment. It curbs the mischief of trying to time the market or speculating wildly based on market conditions.

4. Flexibility
The plus side of SIP is flexibility in terms of amount to be invested, choice of mutual fund, and redemption, which allows investment strategies to change with fluctuations in financial needs.

Common Mistakes to Avoid While Investing in SIPs

While SIPs are viewed overall as a risk-free and effective investment avenue, there are several common blunders that can arrest your returns.

1. Stopping SIPs during Market Downturns
One of the biggest mistakes is to stop SIPs when markets are in a downturn. Instead, this is the time to continue investing and benefit through lower unit prices.

2. Lack of Diversification
Invest in a one-type fund or sector so that the portfolio lacks diversification and is at unnecessary risk. So, make sure to distribute your SIP investments among various sectors and market caps.

3. Failure to Observe Performance of Funds
You need to monitor the performance of your mutual fund SIPs regularly. It is also fine if you change your funds when they perform poorly as compared to the market.

SIP vs Lump Sum Investment : Which is Better in 2024?

In the year 2024, the uncertainty and volatility reflected across global economies are going to form a good playing field of the market for SIP investments. Even though SIPs show lower returns in the growth phase of the bull market, they are more safe when the cost is averaged out over time. In comparison with the lump sum investment, the advantages gained by SIP are as follows:
SIP: Lower risk, rupee cost averaging, disciplined investment
Lump Sum: Higher returns in a rising market but carries the risk of market timing.

Conclusion

October 2024 Investment in Mutual Fund SIPs Good time to invest in mutual fund SIPs in the current market scenarios. Either looking for stable growth through large-cap funds or high returns through small-cap funds, all will find the ideal SIP portfolio. With persistence, using the compounding power, not committing common mistakes in investments, a person can make the most out of it and can achieve long-term financial objectives.

Disclaimer:

All above recommendations are of the market analysts. Neither the author, nor the brokerage firm, nor Stockstoday.in will be responsible for any loss arising out of any such decision taken based upon this information. All users are cautioned to take their own expert advice prior to making any investment decision.