4 SIPs to invest in the ICICI prudential mutual fund
ICICI Prudential Midcap Fund
This fund has given a phenomenal 83% return over the past year. That said, most mid-cap mutual funds have produced similar returns. Please note that before investing in mid-cap mutual funds the reader should be prepared to take the risk as these funds are highly volatile and returns can be pervasive.
This fund is one of the very old names in the midcap space and was launched in 2004. 96% of the funds are invested in midcap shares, while the balance of assets under management is held in cash and cash equivalents. Not a very large amount is needed to invest in SIPs – in fact, investors only need Rs 1,000 each month to be able to start a systematic investment plan. The expense ratio of 2.39% is higher.
Investors who wish to remain invested for a longer period of 5 years can consider the ICICI Prudential Midcap Fund.
ICICI prudential savings fund
This fund tends to diversify the composition of assets under management by investing in debt and money market instruments of various maturities with the aim of maximizing income while maintaining a good balance between return, security and liquidity.
If we see the fund’s returns over the past year, it’s 5.15%, which is slightly higher than what the country’s major nationalized banks are offering in terms of interest. The 3-year yields were also in line with the interest rates in the banking sector at this time. The 3-year fund returns are around 7.76%.
This fund is intended for those looking for high security as well as high returns. Fund returns are expected to be broadly in line with interest rates in the economy.
ICICI Prudential Bluechip Fund
While we previously recommended a mid cap fund and a pure debt fund, we now recommend a large cap fund. Assets under management are invested in companies with a large market capitalization in order to generate superior returns.
If you are looking to invest through SIPs, you can do so with an amount of just Rs 100. The initial amount is Rs 100. If you want to redeem the shares before 1 year, there is an outflow of 1 % charge as is the case with all equity mutual funds.
It is one of the largest equity mutual funds in the country with assets under management of over Rs 28,000 crore. The fund gave a 1 year return of 47%, while the three year return is 13.54% on an annualized basis. A SIP of Rs 10,000 each month for the past 36 months would have generated a corpus of Rs 4.87 lakhs.
ICICI prudential liquid fund
ICICI Prudential Liquid Fund tends to invest almost 80 percent of the corpus in money market securities, while the remainder would be invested in high quality debt securities. It is therefore essentially a debt fund, which seeks security at the same time as returns.
Much of the money is invested in treasury bills, while the remainder is invested in high quality debt securities like commercial paper from Reliance Industries, Chennai Petroleum, Tata Power, etc.
You can start a SIP in this fund with an investment of Rs 99 per month only. It is an open-end fund with substantial assets under management of Rs 36,000 crore. Opt for this fund in case you want stability of returns with security. Expect returns close to the bank deposit range. In fact, it can also be slightly lower than bank deposits.
Investors are advised to exercise caution before investing in any of the above programs and should only invest if they are able to bear losses. Greynium Information Technologies, the author and the brokerage firm cannot be held responsible for losses suffered as a result of decisions based on the above article. Please consult a professional advisor.
About the Author:
Sunil Fernandes, the author of the article is an expert on the stock markets and has spent approximately 27 years covering the stock markets and mutual funds. He has collaborated with various publications including Hindustan Times, Deccan Herald, Oman Economic Review and Dalal Street Investment Journal. He also participated in the analysis of equity research.