Ruchi SrivastavaMay 2025 has just begun, and we are all waiting for the new schemes and mutual funds to be launched. It’s recommended that you make an investment at the beginning of the month and enjoy its returns and benefits at the end. But many mutual fund investors, particularly those new to investing, often struggle with selecting the right mix of schemes to meet their different financial goals, especially long-term ones like retirement. They frequently search for a pre-designed mutual fund portfolio to guide them.
Keeping that in mind, ETMutualFunds introduced its recommended SIP-based mutual fund portfolios in October 2016. Since then, the performance of these schemes has been vigorously tracked and provided with regular updates. Due to this, the readers are alerted about underperforming funds and suggested suitable replacements. In this Blog, we will tell you about the top SIP portfolios from ETMutualFunds, which are designed to match three distinct investor risk profiles: Conservative, Moderate, and Aggressive. Additionally, we will also let you know about the SIP Investment in Mutual Funds portfolios for the investment ranges — Rs 2,000–5,000, Rs 5,000–10,000, and above Rs 10,000.
What is SIP Investment in Mutual Funds?
A Systematic Investment Plan (SIP) is a way to invest a fixed sum regularly, usually every month, into a mutual fund. Rather than making a one-time investment, SIPs let you contribute smaller amounts consistently, helping you grow your wealth steadily over time.
With SIPs, mutual fund units are purchased on a specific date each month, regardless of market fluctuations. This strategy benefits from rupee cost averaging—where you buy more units when prices are low and fewer when they’re high—and promotes disciplined investing. SIPs are especially favored for achieving long-term financial goals like retirement, children’s education, or purchasing a home.
Recommended portfolio for Low-risk investors
| Investor Category | SIP Amount | Fund Category | Scheme Name | Allocation (%) |
| Conservative | ₹2,000–₹5,000 | Equity: Large Cap | Canara Robeco Bluechip Equity Fund – Direct Plan – Growth | 50% |
| Hybrid: Conservative Hybrid | ICICI Prudential Regular Savings – Direct Plan – Growth | 50% | ||
| ₹5,000–₹10,000 | Equity: Large Cap | Canara Robeco Bluechip Fund – Direct Plan – Growth | 30% | |
| Equity: Large Cap | Mirae Asset Large Cap Fund / Axis Bluechip Fund – Direct Plan – Growth | 20% | ||
| Hybrid: Conservative Hybrid | ICICI Prudential Regular Savings – Direct Plan – Growth | 50% | ||
| Above ₹10,000 | Equity: Large Cap | Canara Robeco Bluechip Fund – Direct Plan – Growth | 25% | |
| Equity: Large Cap | Mirae Asset Large Cap Fund / Axis Bluechip Fund – Direct Plan – Growth | 15% | ||
| Equity: Flexi Cap | Parag Parikh Flexi Cap Fund / Canara Robeco Flexi Cap Fund – Direct Plan – Growth (in that order of preference) | 10% | ||
| Hybrid: Conservative Hybrid | ICICI Prudential Regular Savings – Direct Plan – Growth | 50% |
Recommended Portfolio for Moderate Investors
| Investor Category | SIP Amount | Fund Category | Scheme Name | Allocation (%) |
| Moderate | ₹2,000–₹5,000 | Equity: Large Cap | Canara Robeco Bluechip Equity Fund – Direct Plan – Growth | 65% |
| Hybrid: Conservative Hybrid | ICICI Prudential Regular Savings – Direct Plan – Growth | 35% | ||
| ₹5,000–₹10,000 | Equity: Large Cap | Canara Robeco Bluechip Fund – Direct Plan – Growth | 40% | |
| Equity: Flexi Cap | Parag Parikh Flexi Cap Fund / UTI Flexi Cap Fund / Canara Robeco Flexi Cap Fund – Direct Plan – Growth (in that order) | 25% | ||
| Hybrid: Conservative Hybrid | ICICI Prudential Regular Savings – Direct Plan – Growth | 35% | ||
| Above ₹10,000 | Equity: Large Cap | Canara Robeco Bluechip Fund – Direct Plan – Growth | 25% | |
| Equity: Large Cap | Mirae Asset Large Cap Fund / Axis Bluechip Fund – Direct Plan – Growth | 15% | ||
| Equity: Flexi Cap | Parag Parikh Flexi Cap Fund / UTI Flexi Cap Fund / Canara Robeco Flexi Cap Fund – Direct Plan – Growth (in that order) | 25% | ||
| Hybrid: Conservative Hybrid | ICICI Prudential Regular Savings – Direct Plan – Growth |
Recommended Portfolio for High-Risk Investors
| Investor Category | SIP Amount | Fund Category | Scheme Name | Allocation (%) |
| Aggressive | ₹2,000–₹5,000 | Equity: Flexi Cap | Parag Parikh Flexi Cap Fund / PGIM India Flexi Cap Fund – Direct Plan – Growth | 50% |
| Equity: Large Cap | Canara Robeco Bluechip Equity Fund – Direct Plan – Growth | 50% | ||
| ₹5,000–₹10,000 | Equity: Flexi Cap | Parag Parikh Flexi Cap Fund / PGIM India Flexi Cap Fund – Direct Plan – Growth | 30% | |
| Equity: Large Cap | Canara Robeco Bluechip Equity Fund – Direct Plan – Growth | 25% | ||
| Hybrid: Aggressive Hybrid | Mirae Asset Hybrid Equity Fund / SBI Equity Hybrid Fund / Canara Robeco Equity Hybrid Fund – Direct Plan – Growth (in that order) | 10% | ||
| Equity: Mid Cap | PGIM India Midcap Opportunities Fund / Axis Midcap Fund / Invesco India Mid Cap Fund – Direct Plan – Growth (in that order) | 35% | ||
| Above ₹10,000 | Equity: Large Cap | Canara Robeco Bluechip Equity Fund – Direct Plan – Growth | 20% | |
| Equity: Small Cap | Axis Small Cap Fund / SBI Small Cap Fund / Nippon India Small Cap Fund – Direct Plan – Growth (in that order) | 10% | ||
| Equity: Flexi Cap | Parag Parikh Flexi Cap Fund / PGIM India Flexi Cap Fund – Direct Plan – Growth | 25% | ||
| Equity: Large & Mid Cap | Axis Growth Opportunities Fund / Canara Robeco Emerging Equities Fund – Direct Plan – Growth (in that order) | 15% | ||
| Hybrid: Aggressive Hybrid | Mirae Asset Hybrid Equity Fund / SBI Equity Hybrid Fund / Canara Robeco Equity Hybrid Fund – Direct Plan – Growth (in that order) | 10% | ||
| Equity: Mid Cap | PGIM India Midcap Opportunities Fund / Axis Midcap Fund / Invesco India Mid Cap Fund – Direct Plan – Growth (in that order) | 20% |
How ET Mutual Funds Selects Equity Mutual Fund Schemes?
ETMutualFunds uses the following criteria to shortlist equity mutual funds:
- Rolling Returns (3-Year Average):
Daily rolling returns are calculated over the past three years to assess performance consistency. - Consistency Score Using Hurst Exponent (H):
This measures the predictability of a fund’s NAV movement:- H = 0.5: NAV behaves randomly, hard to predict.
- H < 0.5: Indicates mean-reverting behavior.
- H > 0.5: Shows persistent trends; higher H means lower volatility and greater trend stability.
- Downside Risk (Negative Returns Only):
Only losses are analyzed to evaluate risk. The formula used is:- X = Negative returns
- Y = Sum of X²
- Z = Y / Number of days
- Downside Risk = √Z
- Outperformance via Jensen’s Alpha (3-Year Basis):
This metric compares a fund’s returns against the expected market returns. A higher alpha means the fund has outperformed its benchmark after adjusting for risk.
Formula:
Expected Return = Risk-Free Rate + Beta × (Index Return – Risk-Free Rate)
- Minimum Asset Size:
We consider only funds with a minimum Asset Under Management (AUM) of ₹50 crore for evaluation.
How ET Mutual Funds Evaluates Debt Mutual Fund Schemes?
ETMutualFunds applies the following parameters to assess and shortlist debt mutual fund schemes:
- Rolling Average Returns:
We evaluate performance trends using daily rolling returns over the past three years. - Performance Consistency (Using Hurst Exponent – H):
The Hurst exponent helps assess the stability of a fund’s NAV. A higher H value suggests reduced volatility and more predictable trends.- H = 0.5: NAV follows a random, unpredictable pattern.
- H < 0.5: Indicates a tendency to revert to the mean.
- H > 0.5: Shows persistent performance trends; the higher the H, the stronger the trend.
- Measuring Downside Risk (Only Negative Returns Considered):
Analysts take only losses into account. The formula used:- X = Returns below zero
- Y = Sum of squares of X
- Z = Y / Number of days
- Downside Risk = √Z
- Excess Return Over Benchmark (Outperformance):
Calculated as the difference between the fund’s and its benchmark’s daily rolling returns, this shows the active return generated by the fund. - Minimum Asset Size Requirement:
The analysis includes only debt funds with assets under management (AUM) of at least ₹50 crore.
Selection Criteria for Hybrid Mutual Fund Schemes by ET Mutual Funds
1. Rolling Returns (3-Year Average):
We use daily rolling returns over the last three years to assess overall performance.
2. Performance Stability (Hurst Exponent – H):
This metric evaluates the consistency of NAV movements. A higher H suggests more stable returns with less volatility.
- H = 0.5: Indicates randomness; difficult to predict.
- H < 0.5: Suggests a tendency to revert to the mean.
- H > 0.5: Shows persistent trends; the higher the value, the more stable and directional the movement.
3. Downside Risk (Focus on Losses Only):
Analysts examine only negative returns to understand potential losses. Formula used:
- X = Negative returns
- Y = Sum of squared negative returns
- Z = Y / Number of days
- Downside Risk = √Z
4. Outperformance Measurement:
- Equity Component: Evaluated using Jensen’s Alpha over three years. This measures excess return over the expected market return based on CAPM. A higher alpha signals strong risk-adjusted performance.
Formula:
Expected Return = Risk-Free Rate + Beta × (Index Return – Risk-Free Rate) - Debt Component: Assessed using the difference between the fund’s and its benchmark’s rolling returns, calculated daily.
5. Minimum Fund Size:
The analysis includes only hybrid funds with a minimum asset base of ₹50 crore.
Final Thoughts
May 2025 is an ideal time to review and adjust your investment plan, particularly if you’re beginning or increasing your SIP Investment in Mutual Funds contributions. Focus on selecting mutual funds that match your financial objectives and comfort with risk. Keep in mind, SIP investing is a long-term journey, not a quick win. Staying consistent, patient, and disciplined can lead to substantial wealth creation over time.
Sources: msn.com
