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HDFC SIP

An SIP, short for Systematic Investment Plan, is an excellent tool that helps retail investors make regular, smaller investments in their choice of mutual fund schemes. With an SIP, you do not need to worry about timing the market according to their potential. HDFC has ensured to design their SIPs in the most customer-driven manner. These are easy to avail and extremely flexible too. Using this, investors can effectively increase their wealth through smart, short investments in mutual fund schemes.

How does HDFC Mutual Fund SIP works?

HDFC SIP invests a fixed amount in the chosen mutual fund which will grow as per the prevailing market conditions, till the mutual fund investment matures. The investor is paid all benefits after the investment plan matures. You can also choose to increase or decrease your HDFC SIP investment plan period, as long as it has at least a 6-months period of maturity.

Benefits of Investing in HDFC Mutual Fund SIP

The top benefits of using HDFC SIP for making HDFC Mutual Funds investment are:

Disciplined Investment

Using SIP for investment ensures that you make regular investments of a pre-determined amount in different mutual funds schemes. This disciplined approach helps to organize your investment and other budget in the best-possible manner.

Rupee-Cost Averaging Benefits

With an SIP, you are buying fund units for a set amount only, irrespective of the cost (high or low) of the fund units. This results in buying more or less fund units each time. This is an excellent example of the rupee-cost benefit.

Flexibility of Investment Tenure

As per investment regulations, your HDFC SIP can be for as less at 6 months to help achieve short-term investment goals and as long as 10 years or even more, depending on your choice completely (subject to individual mutual fund period regulations).

Flexibility of Investment Amount

With an SIP, you can choose the tenure of your SIP investments and decide the amount of every individual SIP (minimum INR 500). Also, you can increase or decrease every individual SIP amount without any hassles or penalties.

Benefit of Long-Term Investment

Small investments done today through HDFC SIP in HDFC Mutual Funds can help to increase your wealth significantly and enable achievement of long-term investment goals sooner than you planned.

Minimum Efforts to Gain Higher Returns

When you are using HDFC SIP, your investments are done automatically. For the long-term, SIP results in far less effort for investing, as compared to investing lumpsum amount, and results in significantly safer increase in your wealth.

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HDFC Small Cap Fund (G)

The HDFC Small Cap Fund, as the name suggests, is a comparatively higher-risk investment avenue but the remarkably higher ROI involved in this is what attracts tens of thousands of retail investors to use it.

HDFC Capital Builder Value Fund (G)

With the HDFC Capital Builder Value Fund scheme, a specific market sector is followed which results in investing using the market-cap agnostic process of investing in equities. Besides this, this mutual fund investment can also invest capital in high-end debt-driven or money-market focused areas, if the conditions are favorable.

HDFC Long Term Advantage Fund (G)

The HDFC Long Term Advantage Fund is an ideal tool to make small investments in ELSS. This mutual fund invests a larger portion from the complete investment capital in large-cap equity investment avenues. The remaining smaller portion of capital is invested in small and mid-cap equity markets. This has enabled this particular HDFC Mutual Fund scheme to provide higher ROI in bearish market conditions, better than other similar investment methods.

HDFC Balanced Advantage Fund (G)

The HDFC Balanced Advantage Fund is an open-ended balanced investment plan which is best-suited for retail investors who are looking to have a regular supplement for their main income (salary), apart from increasing their wealth at a better rate and also ensuring that their investment capital is secure against the frequent fluctuation in market conditions.

HDFC Mid-Cap Opportunities Fund (G)

As the name suggests, the HDFC Mid-Cap Opportunities Fund is an open-ended equity investment scheme that works to provide investors with benefits in the long run. Under this investment scheme, majority of investment capital is allocated for investment in equities and equity-based mid-cap investment avenues.

HDFC Top 100 Fund (G)

Under the HDFC Top 100 Fund all investment opportunities are only chosen from the top 100 performing companies in the S&P; BSE 100 index, thus reducing risk and maintaining a steady growth in wealth.

HDFC Index Fund – Sensex Plan (G)

The HDFC Index Fund – Sensex Plan is mainly aimed at individual expert investors with short-term goals of increasing wealth considerably, especially for those with a medium to high risk appetite.

HDFC Equity Savings Fund (G)

The HDFC Equity Savings Fund makes investments in low to medium risk equities, debt-driven investment and derivative investment schemes. Importantly, with derivatives, your net equity exposure is reduced as much as 20% to 40%, although it varies from fund to fund.

HDFC Index Fund Nifty 50 Plan (G)

The HDFC Index Nifty 50 Plan is designed to provide returns that are on par with the complete return of equity securities, according to the current index. The majority of investment under this plan is done in equities and equity-based instruments of investment.

HDFC Equity Fund (G)

Under the HDFC Equity Fund, your investment capital is mostly invested in leading companies that have a strong financial foundation currently.

HDFC Tax Saver Fund (G)

Also known as ELSS (Equity Linked Savings Schemes), the HDFC Tax Saver Fund has a lock-in period of only 3 years, helping you achieve your short-term investment goals excellently and get tax-free dividends at the maturity of your investment plan.

HDFC Dynamic PE Ratio Fund of Funds (G)

The HDFC Dynamic PE Ratio Fund of Funds investment scheme is designed to make investments in mostly foreign-based funds, which are made of foreign stocks. This is an excellent way for individual Indian investors to make investments in top international stocks. Below is a table depicting the salient points of some of these top mutual fund investment schemes from HDFC Mutual Fund AMC:

Fund Name1-Year Return3-Year Returns5-Y Return %Total SIP InvestmentSIP Maturity Value
HDFC Small Cap Fund22.06%18.48%21.58%INR 24,000INR 27,689
HDFC Balanced Advantage Fund 15.51%10.97%17.42%INR 24,000INR 26,513
HDFC Capital Builder Fund17.78%13.83%19.40%INR 24,000INR 26,953
HDFC Long Term Advantage Fund19.57%12.16%18.81%INR 24,000INR 27,205
HDFC Tax Saver Fund18.68%10.21%17.82%INR 24,000INR 27,607

Exit Load and Lock-In Period Considerations for SIP

The HDFC Mutual Fund AMC Schemes allows an exit load which is applicable to fund units which have been held for less than the pre-determined time period, according to investment policy documents. Under this, there are no penalties or exit load charges which are applicable, depending on the date on which the fund units were actually allocated, as per the applicable NAV rules.

For example, if you were to transfer 100 units through an SIP purchase of any fund on the 1st of April, 2018 and then buy another 115 fund units from the same mutual fund, using SIP, on the 1st of May, 2018. If we assume the exit load of the fund to be 1% for switching/redeeming fund units before the completion of 1 year (365 days) from the date of initial purchase of these funds. In such a condition, the investor is not charged an exit load (charge) in case the investor redeems/switches 100 fund units on 3rd of April, 2019. In contrast, if the investor was to redeem/switch all 215 fund units on, or before, 1st of May, 2018, the investor has to pay the complete applicable exit load on all fund units purchased through SIP after 1st of May, 2018.

It is important to note that the exit load is not determined by any long-term or short-term capital gains taxes which may be applicable for your individual choice of mutual fund scheme, at the time you are redeeming/switching as these are separately charged taxes.

FAQs on HDFC SIP

Can I buy mutual funds without a broker?

Yes, As per SEBI Circular no CIR/IMD/DF/21/2012 (dated 13th September, 2012), the ‘Direct Plans’ are designed as separate open-ended investment schemes for investors looking to bypass the brokers for buying mutual funds.

Can you lose your money in a mutual fund?

As with any type of market linked investment opportunities, mutual funds are also subject to losses. Hence, if you invest in a mutual fund with a high risk level and the markets falls, then you are likely to lose money in a mutual fund.

How can I invest in SIP mutual funds?

Once you have opened an HDFC Mutual Fund investment account, all you need to do is link it with any existing current or savings bank account. A standing instruction to your bank to allocate a pre-determined amount as investment, at frequent intervals, needs to be set up for successfully investing in SIP mutual funds.

How can I open a mutual fund account in HDFC?

There are two ways you can go about to open a mutual fund account in HDFC. On one hand, you can choose to visit the nearest HDFC Mutual Fund/Bank branch and request for an Investment Services Account. Similarly, you can also choose to visit the official website of HDFC Mutual Fund/Bank, download the form, get a hard copy to fill and simply visit the closest HDFC Mutual Fund/Bank branch and submit the form.

How can I start SIP online?

It is easy to start an SIP online today. First, you will need to keep your KYC (Know Your Customer) details before choosing to start an SIP online. Thanks to eKYC, you can complete this formality online, by visiting the official website of your chosen fund house.

How can I stop SIP in mutual fund?

You can simply log-on to your mutual fund investment account online and select ‘Cancel SIP’ option. In case you make your investments through a broker/online agent, you can also cancel your mutual fund SIP using their online portal.

How do beginners invest in mutual funds?

You will need to open an Investment Services Account with your mutual fund investment provider. For this, you can choose to visit their closest branch in person and fill the required form or alternatively, you can choose to visit their official website and download the form to submit it at the nearest branch of your choice of fund house.

How do I invest in mutual funds?

You can choose to make a lumpsum investment in mutual funds, or you can choose to use SIP (Systematic Investment Plan) and make smaller, regular investments in mutual funds of your choice directly from your current/savings bank account.

Is DEMAT account required for SIP?

No, A DEMAT account is mainly required for trading in the stock markets and is not a requirement for investing in mutual fund schemes of any sort, including using SIP. Only a KYC is mandatory for using SIP to make mutual fund investments.

Is it safe to invest in mutual funds?

As is with any other form of monetary investment instrument, mutual fund schemes are also dependent on the performance of the capital / investment market. Hence, it is considered safe to invest in mutual funds, provided you have done your research to select your choice of mutual funds to invest in.

Is it worth to invest in mutual funds?

Mutual funds are different than other forms of investing opportunities as they provide investment in diverse types of stocks. This helps to mitigate the overall risk you may face and gets you considerable return on investments too.

What is HDFC SIP plan?

The HDFC SIP (Systematic Investment Plan) is designed to help retail investors make proportionate, regular payments towards investment in various mutual fund schemes. A pre-determined amount is invested on a regular (daily/weekly/fortnightly/monthly/quarterly) basis automatically from your linked bank account, at the designated date. This is an excellent tool of investing in considerably safe investment avenues to realize long-term wealth increasing goals.

What is HPIN in HDFC Mutual Fund?

An HPIN is a unique serial number which is allocated to every Investment Services Account holder with HDFC Bank. This is a unique ID number and mainly helps you access your online investment profile.

Which HDFC Mutual Fund is best?

There are numerous types and classes of mutual funds provided by HDFC Mutual Fund AMC today. As these are all designed to help investors achieve their goals in their own individual ways, you will need to learn about the top HDFC Mutual Funds investment schemes to decide which is best for you, according to your individual risk-appetite and investment goals.

Which HDFC SIP is best?

As is with mutual funds, HDFC offers SIP to help make investment in mutual funds easier. As the SIP may vary, depending on the investment amount determined and the frequency of payments for investments, you will need to read more about the offered HDFC SIPs and decide which is best-suited according to your individual needs.

Which is best mutual fund for SIP?

Again, as mutual funds come with different risk-levels and varying rate or ROI, you will need to determine the best-suited mutual fund for SIP, depending on your specific investment objectives.

Which is best SIP plan?

You will need to consider various factors, such as your individual risk-appetite, long-term/short-term investment aims, etc. to determine the best SIP plan for you.

Which is the best mutual fund to invest in India?

There are several renowned, reliable and leading fund houses in India and the chief amongst them is HDFC Mutual Fund AMC. However, you can surely do your own research and learn more about the policies and benefits provided by the different fund houses in India and select the one which caters to your investment needs better.

Which is the safest mutual fund in India?

Although mutual funds are considered to be the safest form of investment in equities, there is no investment without some level of risk involved. Hence, you will need to check the risk level of any mutual fund before deciding the safest mutual fund to invest in India.

Which mutual fund is best for SIP?

Always choose the mutual fund scheme which is in accordance to your individual risk level and ROI, as well as whether it is long-term or short-term investment schemes. These details are most helpful to decide the mutual fund which is best for SIP.

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