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12 Best SIPs For The Long Term (10-20 Year Investment Time Frame Starting 2021)

Looking for long term SIP mutual funds? Read this blog to know more about the best SIPs for 10 to 20 years from the world of equity, debt, international, and liquid mutual funds. Find out how Cube Wealth makes it super simple to invest in SIPs online.
March 15, 2021

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[Updated on 14-10-2021]

The best Systematic Investment Plans (SIPs) have the potential to grow your wealth over the long term while simultaneously weathering the impact of short term fluctuations. 

In this blog, we’re going to tell you about the 12 best SIP mutual funds handpicked by our advisor, Wealth First. But before we jump in, let’s look at the benefits of investing using SIPs. 

Why Should You Invest In SIP Or Systematic Investment Plan?

Investing in the best SIPs is one of the smartest ways to generate wealth across market cycles. That means whether the markets go up or down you continue investing. Let’s look at all the SIP mutual fund benefits in depth. 

1. High Returns

The best SIPs in equity or international mutual funds have the potential to compound. This can help investors accumulate a large sum of money in the future. These funds have been known to generate close to 10-18% returns over 5+ years.

For example, here’s a hypothetical example of what could happen if you invested ₹10,000 per month each in an equity (@12%) or an international fund (@15%) for 10+ years. 

 

Fund Type

10-Year SIP Returns

20-Year SIP Returns

Equity

₹11,23,390

₹75,91,479

International

₹15,86,572

₹1,27,59, 549

2. Rupee Cost Averaging

Rupee cost averaging ensures you buy: 

  • More shares when the markets are down
  • Fewer shares when the markets are up

This will average out the impact of short term fluctuations and save you from the hassle of choosing the right time to invest. Here’s a hypothetical example of rupee cost averaging at work in SIPs Vs lump sum:

 

Name

Mr X

Mr Y

Month

NAV

Invested

Units

NAV

Invested

Units

Jan

20

₹2000

100

20

₹6000

300

Feb

40

₹2000

50

-

-

-

March

10

₹2000

200

-

-

-

Total

-

₹6000

350

-

₹6000

300

3. Affordable

A SIP is affordable because you don’t have to invest a large sum of money or lump sum. Instead, you invest a small amount of money, as low as ₹1000, every month or quarter.

12 Best SIPs For 10-20 Year Investment In FY 21 - 22

Here’s a sneak peek into SIPs currently being recommended by Cube’s mutual fund advisor, Wealth First and are perhaps the best SIPs to invest in for 10 to 20 years.

Best Equity Fund SIPs For 10-20 Years

Equity funds primarily invest in the shares of Indian companies with the aim of generating lucrative long term returns. Starting a SIP in equity funds is known to be relatively less risky than buying stocks directly.

1. Mirae Asset Large Cap Fund

You can access the stock of some of the biggest companies and industry leaders in India like Infosys, HDFC Bank, Reliance Industries, TCS, and others by investing in Mirae Asset Large Cap Fund. 

These companies are known as “large-cap” because of their stellar market capitalisation. In fact, more than 80% of Mirae Asset Large Cap Fund’s portfolio includes the shares of the top 100 Indian companies.

  • Type: Large-cap fund
  • 1-year returns: 56.11%
  • 3-year returns: 14.54%
  • 5-year returns: 15.87%

Here’s a snapshot of the top stocks held by Mirae Asset Large Cap Fund.

Company

Stock Ticker

Infosys

INFY

HDFC Bank

HDFCBANK

ICICI Bank

ICICIBANK

Reliance Industries

RELIANCE

Axis Bank

AXISBANK

2. Canara Robeco Emerging Equities Fund

Canara Robeco Emerging Equities Fund essentially invests in large-cap and mid-cap companies that have the potential to become sector leaders in the future. This includes the likes of Axis Bank and Max Healthcare. 

Furthermore, the fund managers are known to invest in high-quality companies instead of following the crowd and chasing short term profits. Over 50% of the fund’s portfolio is large-cap oriented. 

  • Type: Large & mid-cap fund
  • 1-year returns: 63.35%
  • 3-year returns: 15.01%
  • 5-year returns: 18.08%

Here’s a snapshot of the top stocks held by Canara Robeco Emerging Equities Fund.

Company

Stock Ticker

HDFC Bank

HDFCBANK

Reliance Industries Ltd

RELIANCE

Infosys

INFY

Bajaj Finance Ltd

BAJFINANCE

Minda Industries Ltd

MINDAIND

3. Axis Focused 25 Fund

You can access 25 of the best stocks in total from the large-cap, mid-cap, and small-cap categories by investing in Axis Focused 25 Fund. It’s a focused fund that can invest in up to 25 stocks, as the name suggests. 

The aim of the fund is to generate long term returns with highly diversified stocks from different sectors like Info Edge, Avenue Supermarts, Pidilite Industries, and others.   

  • Type: Flexi-cap (focused) fund
  • 1-year returns: 56.04%
  • 3-year returns: 14.48%
  • 5-year returns: 17.70%

Here’s a snapshot of the top stocks held by Axis Focused 25 Fund.

Company

Stock Ticker

Bajaj Finance Ltd

BAJFINANCE

Tata Consultancy Services Ltd

TCS

Info Edge (India) Ltd

NAUKRI

Avenue Supermarts Ltd

DMART

Divi's Laboratories Ltd

DIVISLAB

Best Debt Fund SIPs For 10-20 years

Debt funds are generally considered to fall under the low risk, predictable rewards category. They invest in debt instruments like government bonds, corporate bonds, money market instruments, and more.

1. IDFC Banking & PSU Debt Fund

Starting a SIP in the IDFC Banking & PSU Debt Fund will allow you to access high-rated (AAA) bonds, certificates of deposit (CDs), commercial paper (CP), and other debt securities issued by PSUs and banks. 

  • Type: Banking & PSU fund
  • 1-year returns: 6.70%
  • 3-year returns: 9.69%
  • 5-year returns: 8.09%

Here’s a snapshot of the top debt securities held by IDFC Banking & PSU Debt Fund.

Holding

Rating

Bond: National Bank For Agriculture and Rural Development

AAA

Bond: Axis Bank Ltd

AAA

Bond: GoI

SOV

Bond: Indian Railway Finance Corporation Limited

AAA

2. ICICI Prudential Corporate Bond Fund

There are debt funds that invest in bonds issued by large corporations. ICICI Prudential Corporate Bond Fund is one of these debt funds. It primarily invests in corporate bonds rated AA or above. 

The average SIP return in the last 10 years produced by ICICI Prudential Corporate Bond Fund is more than 8%, which is far better than most bank FDs and savings accounts.  

  • Type: Corporate bond fund
  • 1-year returns: 8.47%
  • 3-year returns: 8.51%
  • 5-year returns: 8.07%

Here’s a snapshot of the top debt securities held by ICICI Prudential Corporate Bond Fund.

Holding

Rating

Bond: HDFC LTD

AAA

Bond: Rural Electrification Corporation (GoI)

SOV

Bond: GoI Floater 2033

SOV

Bond: NABARD (GoI)

SOV

Bond: National Bank for Agriculture & Rural Development

LAAA

3. HDFC Money Market Fund

You can access high-rated bonds, T-bills, commercial paper, and other money market securities that mature in up to 1 year by investing in the HDFC Money Market Fund. 

The average returns of this mutual fund in the past 10 years has been approximately 7.70%, which is better than most bank FDs. 

  • Type: Money market fund
  • 1-year returns: 4.57%
  • 3-year returns: 6.90%
  • 5-year returns: 6.81%

Here’s a snapshot of the top debt securities held by HDFC Money Market Fund.

Holding

Rating

T-Bill: RBI

SOV

Bond: GoI

SOV

Bond: GoI

SOV

CP: Sun Pharmaceutical Industries

A1+

CP: Reliance Industries

A1+

Best International Fund SIPs For 10-20 years

International funds are Indian mutual funds that invest in the shares of foreign companies like Apple, Amazon, Novartis, etc. They may even invest in the units of foreign mutual funds and ETFs.

Given their investment type, international funds are a high-risk, high-reward category of mutual funds that are suitable for the long term.

1. Edelweiss Greater China Equity Off-shore Fund

Edelweiss Greater China Equity Off-shore Fund invests in the JPMorgan Funds - JF Greater China Equity Fund that can give you access to top Chinese stocks Taiwan Semiconductor, Tencent, Alibaba, and more. 

This is a “Fund of Fund” scheme that invests in another mutual fund instead of stocks or bonds. Cube’s advisor Wealth First has picked this as one of the best mutual funds for the long term as of 10-2021.

  • Type: Fund of fund
  • 1-Year Returns: 50.31%
  • 3-Year Returns: 23.00%
  • 5-Year Returns: 24.75%

Here’s a snapshot of Edelweiss Greater China Equity Off-shore Fund’s top holding.

Mutual Fund

Type

JPMorgan Funds - Greater China Fund

Offshore

2. Franklin India Feeder - Franklin U.S. Opportunities Fund

Certain mutual funds are known to operate in a feeder-master relationship where the feeder fund pools money from investors and invests it in the master fund. 

That’s how Franklin India Feeder - Franklin U.S. Opportunities Fund operates. The master fund, Franklin U.S. Opportunities Fund can give you access to top US stocks like Apple, Amazon, Google, Microsoft, and more.

  • Type: Feeder fund
  • 1-Year Returns: 29.13%
  • 3-Year Returns: 21.72%
  • 5-Year Returns: 20.83%

Here’s a snapshot of Franklin India Feeder - Franklin U.S. Opportunities Fund’s top holding.

Mutual Fund

Type

Franklin U.S. Opportunities Fund

Offshore

3. PGIM India Global Equity Opportunities Fund

PGIM India Global Equity Opportunities Fund is a fund of fund scheme that invests in the PGIM Jennison Global Equity Opportunities Fund, which invests in top global stocks like Tesla, Adyen, MercadoLibre, and more.

  • Type: Fund of fund
  • 1-Year Returns: 31.20%
  • 3-Year Returns: 27.03%
  • 5-Year Returns: 10.51%

Here’s a snapshot of PGIM India Global Equity Opportunities Fund’s top holding.

Mutual Fund

Type

PGIM Jennison Global Equity Opportunities Fund

Offshore

Best Liquid Fund SIPs For 10-20 years

Liquid funds fall under the category of debt funds. However, they're known to be relatively safer than other mutual funds and certain debt funds because their portfolio matures in 60-91 days.

1. Nippon India Liquid Fund

You can access relatively better returns than your bank savings account by investing in the Nippon India Liquid Fund. It invests in debt securities that mature in 60-91 days. 

What’s more, Nippon India Liquid Fund is Cube ATM compatible which means that you can instantly withdraw your investment in less than 30 minutes!

  • Type: Liquid fund
  • 1-Year Returns: 3.23%
  • 3-Year Returns: 5.55%
  • 5-Year Returns: 6.09%

Here’s a snapshot of the top debt securities held by Nippon India Liquid Fund.

Holding

Rating

CB: Reliance Industries

-

Bills Rediscounting: ICICI Bank

-

T-Bill: RBI

SOV

CP: Chennai Petroleum Corporation

A1+

T-Bill: RBI

SOV

2. Invesco India Liquid Fund

Invesco India Liquid Fund primarily invests in debt securities that mature in up to 3 months. The average SIP return of this fund in the last 10 years has outperformed the average bank savings account.

  • Type: Liquid fund
  • 1-Year Returns: 3.20%
  • 3-Year Returns: 5.41%
  • 5-Year Returns: 6.01%

Here’s a snapshot of the top debt securities held by Invesco India Liquid Fund.

Holding

Rating

T-Bill: RBI

SOV

T-Bill: RBI

SOV

T-Bill: RBI

SOV

CP: NABARD

A1+

CP: Reliance Jio Infocomm

A1+

3. Kotak Liquid Fund

Investing in the Kotak Liquid Fund means that you can access high liquidity and relatively safe returns compared to equity funds because its portfolio matures in up to 3 months.

  • Type: Liquid fund
  • 1-Year Returns: 3.22%
  • 3-Year Returns: 5.41%
  • 5-Year Returns: 5.99%

Here’s a snapshot of the top debt securities held by Kotak Liquid Fund.

Holding

Rating

T-Bill: RBI

SOV

T-Bill: RBI

SOV

T-Bill: RBI

SOV

Bond: GoI

SOV

T-Bill: RBI

SOV

Best Long Term SIPs At A Glance

Watch this video to learn more about handpicked mutual funds on Cube Wealth



Shriram Shekhar
Shriram is a Content Marketer at Cube Wealth, the Financial Freedom App with a smart Perfect Portfolio Planner. He has developed cutting edge IT products for over 2 years before turning to his passion for the written word. Shriram’s love for philosophy, product development, and empowering people through quality content is what got him to Cube Wealth.

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