Summary
SIP is an investment approach rather than a separate mutual fund category. Investors can use SIP across different funds.
Bandhan Small Cap Fund earned the highest 3-year return of 27.79%, followed by Invesco India Small Cap Fund with a 3-year return of 24.86%.
The minimum SIP investment for all the listed funds is ₹100.
SIP is a systematic approach, but does not guarantee returns or eliminate volatility risk.
Systematic Investment Plans (SIPs) enable investors to invest a certain amount in a fund at regular intervals instead of investing a large amount at once. It is an investment approach that can be used to invest in various funds, including equity, debt, hybrid, and flexi, across large-cap, mid-cap, and small-cap companies.
Best 10 SIP Plans Mutual Funds In India 2026: Quick Comparison
SIP is an investment strategy used to invest in different asset securities, where investors are allowed to invest a fixed amount of money at intervals rather than paying a huge amount altogether. The following table includes a few of the best mutual funds that allow SIP investment, including their asset size, NAV, and returns as of August 10, 2026.
| Name | NAV | AUM (In ₹ Crores) | Expense Ratio (%) | 1 year Returns (%) | 3 years Returns (%) | 5 years Returns (%) | Minimum SIP Investment (₹) |
| HDFC Flexi Cap Fund | 2,296.80 | 1,10,736.41 | 0.75 | 7.11 | 17.79 | 18.68 | 100 |
| ICICI Prudential Equity and Debt Fund | 459.17 | 51,480.53 | 0.77 | 6.66 | 15.39 | 16.49 | 100 |
| Nippon India Large Cap Fund | 102.76 | 53,227.04 | 0.58 | 2.86 | 13.52 | 15.67 | 100 |
| Bandhan Large and Mid Cap Fund | 166.81 | 18,783.25 | 0.45 | 8.45 | 20.01 | 17.94 | 100 |
| Bandhan Small Cap Fund | 57.00 | 28,466.18 | 0.35 | 14.13 | 27.79 | 20.14 | 100 |
| Edelweiss Aggressive Hybrid Fund | 77.40 | 1,38,960.56 | 0.81 | 7.02 | 15.1 | 14.92 | 100 |
| ICICI Prudential Large Cap Fund | 121.83 | 80,960.34 | 0.71 | 1.69 | 13.19 | 13.41 | 100 |
| Axis Balanced Advantage Fund | 24.58 | 3,814.40 | 1.07 | 6.36 | 13.17 | 11.01 | 100 |
| HDFC Mid Cap Fund | 236.72 | 1,05,142.69 | 0.74 | 12.62 | 20.5 | 20.71 | 100 |
| Invesco India Small Cap Fund | 54.14 | 14,521.81 | 0.42 | 18.81 | 24.86 | 21 | 100 |
Top 10 SIP Plans Mutual Funds
The best SIP plans for mutual funds allow investors to invest in various financial instruments, including equity, debt, hybrid, and flexi funds, across different market capitalisations. While SIP plans can facilitate compounding in the long run, choosing the right fund can be challenging. Below is a description of the top 10 SIP plans for mutual funds, including their strength and weaknesses.
HDFC Flexi Cap Fund
The HDFC Flexi Cap Fund includes a combination of small-cap, mid-cap, and large-cap funds, approaching high-quality companies with growth potential. It has the flexibility to adjust the portfolio according to market performance. The fund has an AUM of ₹1,10,736.41 crore and recorded a 3-year return of 17.79%. The minimum amount for SIP investment is ₹100.
ICICI Prudential Equity and Debt Fund
The ICICI Prudential Equity and Debt Fund includes both equity and debt instruments to take advantage of growth potential from equity stocks, and keep debt instruments as a cushion during volatile markets. The fund has an asset size of ₹51,480.53 crore, with an expense ratio of 0.77% and recorded a 3-year return of 15.39%.
Nippon India Large Cap Fund
The Nippon India Large Cap Fund primarily focuses on large-cap companies, while also having the flexibility to invest in debt instruments, REITs, InvITs, and money market instruments. It has an AUM of ₹53,227.03 crore and delivered a 3-year return of 13.52%, allowing the SIP investment at ₹100. Since the fund focuses on established companies, the growth potential is lower than that of small–cap or mid-cap funds.
Bandhan Large and Mid Cap Fund
The Bandhan Large and Mid Cap Fund invests in a combination of large-cap and mid-cap companies, facilitating both steady income and growth potential. The fund considers domestic and macroeconomic trends while managing the portfolio. It has an AUM of ₹18,783.25 crore with a minimum SIP investment of ₹100, and recorded a 3-year return of 20.01%. Since the fund holds mid-cap equity stocks, it may be impacted by market corrections.
Bandhan Small Cap Fund
The Bandhan Small Cap Fund mostly focuses on small-cap companies that have the potential to grow in future and facilitate capital appreciation over time. It is suitable for investors seeking long-term wealth building. The fund has total assets of ₹28,466.18 crore, allowing investors to start investing with a minimum SIP investment of ₹100. It recorded the highest 3-year return of 27.79%.
Edelweiss Aggressive Hybrid Fund
The Edelweiss Aggressive Hybrid Fund invests mostly in equity stocks, and retains the rest for debt and money market instruments. It focuses on high-quality companies with strong financials and valuations. The fund has the highest AUM of ₹1,38,960.56 crore with an expense ratio of 0.81%, and delivered 3-year returns of 15.1%.
ICICI Prudential Large Cap Fund
The ICICI Prudential Large Cap Fund mainly focuses on large-cap companies, and was formerly known as ICICI Prudential Bluechip Fund. Since these funds avoid investing in new emerging companies, their growth potential is low. It has an AUM of ₹80,960.34 crore and delivered a 3-year return of 13.19%, allowing a minimum SIP investment of ₹100.
Axis Balanced Advantage Fund
The Axis Balanced Advantage Fund involves a dynamic investment strategy where it does not maintain a fixed debt-equity portfolio and makes adjustments based on economic trends, market conditions, and valuations. However, the dynamic adjustment strategy does not eliminate volatility risk, and the fund can still experience loss under inefficient management. It has the lowest AUM among the listed funds of ₹3,814.40 crore and recorded a 3-year return of 13.17%.
HDFC Mid Cap Fund
The HDFC Mid Cap Fund mostly invests in mid-cap companies with a minimum of 65% of asset allocation. It focuses on quality companies with strong financial, valuation, and growth potential. It enables investors to experience steadier performance with potential for expansion. It has one of the highest asset sizes of ₹1,05,142.69 crore and delivered a 3-year return of 20.5%.
Invesco India Small Cap Fund
The Invesco India Small Cap Fund follows a bottom-up stock-picking strategy and invests in small-cap funds with high potential growth. This allows investors to have a small-cap portfolio that includes growth-potential stocks, rather than popular stocks. It has an AUM of ₹14,521.81 crore and recorded the highest 3-year return of 24.86%.
How We Selected These SIP Plans?
The SIP plans are selected based on their qualitative and quantitative attributes.
- Fund category: The funds are selected based on their investment strategy and fund category, such as large-cap, small-cap, mid-cap, hybrid, or flexi.
- SIP accessibility: Funds are based on their accessibility to investors and their required minimum SIP amount.
- Past performance: The historical performance of the funds displays the consistency of performance over a specified span of time.
- Portfolio quality: This fund’s stock selection and allocation display the portfolio quality, including diversification and the manager’s investment strategy.
SIP Plans VS Other Funds Category
SIP is an investment strategy that allows investors to invest a fixed amount at regular intervals, and not a type of mutual fund. Therefore, comparing SIP with other mutual funds is invalid.
Benefits and Risks of SIP Plans
The benefits of investing in SIP Plans are listed below.
- SIP plans help investors build investment discipline through a regular and consistent investing strategy.
- They spread investments across different market conditions and allow investors to take advantage of buying more units during market declines and fewer during market rises.
- They facilitate compounding by allowing investors to earn more returns by reinvesting their returns over time.
The risks associated with SIP Plans are listed below.
- SIP plans do not guarantee returns, since the funds are directly linked to the market. Hence, if the underlying instrument performs poorly, the fund will be equally affected.
- SIPs in equity funds are prone to market risk, since they are heavily dependent on market performance.
- Pausing or exiting a fund due to market declines may impact the compounding power of the SIP investment strategy.
Who Should Consider And Avoid SIP Plans?
Investors who should opt for SIP Plans are mentioned below.
- SIP plans are suitable for investors who receive fixed incomes or salaries.
- Beginners who are new to investing can prefer to invest through SIP plans.
- Investors with a long-term investment horizon and who do not prefer to invest a whole amount all at once.
Investors who should avoid SIP Plans are mentioned below.
- Investors with a short-term investment horizon who seek quick profits by taking advantage of different market conditions.
- Investors who do not have a fixed income source, or freelancers.
- Investors who do not have an emergency fund, since exiting a fund within a short period may be difficult and may even cause a loss.
How To Choose A SIP Plan?
Choosing an SIP plan should involve considering the minimum required amount for SIP investments in the preferred fund. Since it is an investment strategy, the choice should involve whether to opt for an SIP investment strategy, where investors pay a fixed amount at regular intervals or invest in a lump sum, where investors put a huge capital all at once.
SIP vs Lump Sum For SIP Plans
Investors can choose to invest in mutual funds through both SIPs and Lump sums. Let’s understand which is more suitable for investors.
| Basis | SIPs | Lump sum |
| Meaning | Investing a fixed amount at regular intervals | Investing a large amount of capital at once |
| Suitable for | These are suitable for beginners and investors with regular incomes | These are best suited for investors with surplus money available |
| Risk | Relatively lower risk because of rupee cost averaging | Higher Thematic market risk since it is exposed to the market |
| Returns | Steady returns over time, but might be lower in a steadily rising market | May generate high returns if invested during favourable prices |
Direct vs Regular SIP Plans
Let’s understand the difference between direct and regular SIP plans.
| Basis | Direct SIP Plans | Regular SIP Plans |
| Meaning | Directly purchasing from AMCs without any involvement of intermediaries | Purchased through brokerage platforms, banks, or distributors |
| Returns | Relatively higher returns due to lower cost | Relatively lower returns because of certain fees and charges |
| Suitable for | Investors comfortable with independent decision-making and investment management | Investors who seek expert guidance |
| Cost | Low investment cost because of no intermediaries | High cost because it involves distributors and intermediaries |
Taxation of SIP Plans
SIP plan is an investment style that allows investors to invest a fixed amount regularly at intervals. Investors can choose to invest in any type of mutual fund, including equity, debt, flexi, and hybrid. The taxation depends on the securities held and the holding duration of the asset.
For equity mutual funds
- Short-term Capital Gain: When the investment is redeemed within less than one year or 12 months, it is considered short-term capital gains and is taxed at 20%.
- Long-Term Capital Gain: When the investment is redeemed after 12 months, it is considered long-term capital gains and is taxed at a rate of 12.5% on the total income, with an exemption up to ₹1.25 lakhs.
For specified mutual funds
- Any capital gains arising from the redemption of debt mutual funds under specified funds are referred to as short-term capital gains, irrespective of their holding period and are taxed as per the applicable income tax slab. They are measured as per the Income-Tax Act, on or after 1st April 2023.
FAQs
Based on the 3-year returns listed in the comparison as of 10 August 2026, the top five funds allowing SIP investments are Bandhan Small Cap Fund (27.79%), Invesco India Small Cap Fund (24.86%), HDFC Mid Cap Fund (20.50%), Bandhan Large and Mid Cap Fund (20.01%) and HDFC Flexi Cap Fund (17.79%).
SIPs allow investors to spread investments across different market conditions instead of investing the entire amount at once. However, the file does not provide a specific market-timing view, and SIPs remain subject to the performance of the underlying fund.
Among the listed funds, Bandhan Small Cap Fund has the highest 3-year return of 27.79%. However, past performance alone does not establish that it will remain the best performer.
While choosing the best SIP mutual funds, consider the fund category, minimum SIP requirement, historical performance, portfolio quality, diversification and the fund manager’s investment strategy.
SIPs can suit beginners, investors with regular salaries or income, and those with a long-term investment horizon who prefer investing gradually rather than deploying a large amount at once.
Invesco India Small Cap Fund has the highest 1-year return among the listed funds at 18.81%, followed by Bandhan Small Cap Fund at 14.13%.
No. SIPs do not guarantee returns. Since the money remains invested in market-linked mutual funds, the investment can lose value when the underlying securities perform poorly.
SIPs are designed to spread investments over different market conditions, so investors do not need to deploy the entire amount at one market level. However, the suitability depends on the investor’s financial situation, investment horizon and selected fund.
SIPs are market-linked and can offer growth potential, but they also carry market risk, whereas an FD follows a different return and risk structure. The suitable option depends on the investor’s objective and risk tolerance.
