Mutual funds serve as one of the investment avenues that investors can select to earn exponential returns. Moreover, with SIP investment into selected mutual funds, one can generate an extensive amount of wealth through the power of compounding and long-term consistent investment. Out of all the asset management companies, HDFC is one of the most prestigious organizations that offers different types of mutual funds that investors can select for investment. The following article explores how HDFC Mutual Fund investment through SIPs can grow over time:
SIP investment into HDFC Mutual Funds:
A systematic investment plan (SIP) for an HDFC mutual fund allows investors to grow their investments exponentially by taking the benefit of rupee cost averaging and compound growth. Consistent investment of a fixed amount for a definite period can help investors to generate sufficient returns which can help them achieve their financial goals. Consistency and discipline, affordability, and flexibility are all the benefits that Investors receive through SIP investment. Moreover, with the wide availability of diverse HDFC Mutual fund schemes like equity, flexi cap, debt, thematic, etc, investors can diversify their investments to get the best returns.
How the SIP investment calculator helps grow investments:
By providing details like the monthly SIP amount, expected rate of return and the investment duration, investors can arrive at the future value of their investments. The total returns from SIP investment can be ascertained through use of the SIP investment calculator helping investors select the best Hdfc Mutual fund scheme that matches their preference and financial goals.
Let’s learn through the following example:
With an expected rate of return of 12% per annum from SIP Investment into a HDFC equity mutual fund scheme, investors may decide to invest ₹5000 per month for 20 years. With the power of compounding and averaging, investors can generate an estimated amount of ₹50 lakhs in 20 years with a total investment of ₹12 lakhs.
10 years
Total investment: ₹6 lakhs
Returns: ₹11.6 lakhs
15 years
Total investment: ₹9 lakhs
Returns: ₹27 lakhs
20 years
Total investment: ₹12 lakhs
Returns: ₹50 lakhs
On the other hand, a flexi-cap HDFC mutual funds scheme may deliver 10% returns. With the same investment for the same duration, an investor will generate considerably less returns.
10 years
Total investment: ₹6 lakhs
Returns: ₹10.08 lakhs
15 years
Total investment: ₹9 lakhs
Returns: ₹20.08 lakhs
20 years
Total investment: ₹12 lakhs
Returns: ₹36 lakhs
As the period increases, the returns decrease as well for the flexi cap fund making it imperative for investors to make the right investment and mutual fund scheme selection.
Through the consistent investment of a fixed amount overall a period, investors can generate an exponential amount of returns that even day-to-day trading may not deliver. The SIP Calculator can help Investors select the best HDFC mutual fund schemes that offer the best returns. The SIP amount by matching the financial needs and expenses, the total period of investment, and even the right mutual fund schemes can be identified through an SIP calculator.
Conclusion:
Investment into HDFC mutual fund schemes allow investors to get the best returns through SIPs. With consistent investment over a long period, HDFC mutual fund schemes can help grow the total investments exponentially through compounding.