Are you looking for the top mutual funds for SIP to invest in 2025 in India? Read this complete article to get the list of mutual funds that I am suggesting you and also the things to keep in mind while investing in MF.

Before knowing the best mutual funds to invest in 2025, let me explain the process to invest in mutual funds.

In addition, you need to connect all the dots and take investment decisions.

Process to invest in equity mutual funds?…

Why should you invest in equity mutual funds? ..

a) To beat the inflation…

You may have heard about the inflation.

In addition, due to this inflation, the cost of goods like milk, eggs, and rice, etc., and services like doctor fees, etc., will rise every year.

Moreover, you have to save that surplus money somewhere to earn some interest or profits that can be utilised for your future needs or future financial goals.

But most of the savings, like bank FD, postal FD, life insurance endowment policies, chit funds, etc., will not give ROI on investment over and above inflation.

If that happens, your purchasing power of money will come down, and slowly you will become poor.

And this will not happen over night.

So, inflation is also called a silent killer.

Finally, to stay on top of inflation, investing in equity mutual funds is a must.

You should follow financial planning…

You need to have your own financial planning in place and you should strictly follow it.

If you can create your financial plan on your own, you better take advice from a Sebi Registered Investment Adviser.

And your investments in mutual funds may not give fruitful results if you do not do goal-based investment.

Finally, you should remember that investment advice can only be given by Sebi Ria legally.

Do not invest 100% in equity mutual funds…

Equity mutual fund investment is subject to market risks.

So, investing 100% money in equity mutual funds is a big risk.

And you should diversify among different assets like equity mutual funds, debt funds, gold, etc. along with equity mutual funds.

Expected portfolio returns in mutual funds…

If you are investing 50% in equity and 50% in debt.

And the ROI expected is 12% p.a. and the ROI expected is 6% p.a.

Then, the portfolio return expected is 50%*12% + 50%*6% = 9%.

Do the risk profling…

Before diversifying your investments across different assets, you need to complete your risk profiling test and know your risk tolerance score.

In addition, it is nothing but your willingness to take the risk in your investments based on your age, time horizon, financial goals, etc.

Finally, do not forget to monitor your risk tolerance score at least once in a year.

Know what type of investor you are?…

Once the risk profiling is done, you will be able to get a risk score.

Which will tell you what type of investor you are based on your risk score.

Generally, there are 5 types of investors there.

• Very aggressive investor.
• Moderately aggressive investor.
• Balanced Investor.
• Moderately conservative investor.
• Very conservative investor.

Do the asset allocation in mutual funds…

After knowing to what type of investor you belong, you can do the asset allotment and invest accordingly.

In addition, You can consider assets like equity mutual funds, gold mutual funds, debt mutual funds, real estate mutual funds, etc.

Moreover, you should not forget government-backed saving schemes like PPF and SSY for your asset allocation in debt.

Avoid overlapping in mutual funds…

While investing in multiple multiple mutual funds, you need to avoid overlapping between two mutual fund schemes.

In addition, you need to have an overlapping of almost nil in two mutual funds that you are going to invest in.

If you feel that investing in two schemes is a must, please make sure that the overlapping is less than 15% at least.

Always compare mutual returns with benchmark returns…

If you are investing in actively managed mutual funds, you should always compare the historical ROI of these funds with the historical ROI of Benchmark for different time periods like 1 year, 3 years, 5 years, and more.

And if the scheme has beaten the benchmark ROI, you can move to steps of filtering the mutual fund scheme.

If no fund is beating the benchmark in terms of ROI, it will be better for you to select an index fund rather than an actively managed mutual fund.

Your mutual funds schmes correlation must be low…

All the mutual fund schemes that you are investing in will have some correlation; it may be a positive or negative correlation.

In addition, investing in negatively related assets is always good.

But it is not easy to get such negatively related assets.

So, at least invest in mutual funds schemes that have a low positive correlation.

And this possible co-relation must be below 65% between two mutual fund schemes.

Select a mutual fund that has a high up capture ratio and a low down capture ratio…

The capture ratio of index funds is always equal to 1.

If you are investing in actively managed mutual funds, the expense ratio of these funds is higher than that of index funds.

In addition, if the active mutual fund is not giving more return than the index fund, it is not wise to invest in it.

And this performance of active fund managers, you will be able to know with the help of Marke up and down capture ratio.

You should do the rebalancing of the portfolio at least once a year…

As you have invested different assets like gold, equity mutual funds, debt funds, etc. in different weights.

In addition, the returns given by these assets are also different.

As a result of this, the actual weights of the assets that you have invested will increase or decrease over time.

So, in the process of getting a risk-adjusted rate of returns, you need to do the rebalancing of the portfolio at least once in a year.

Min. time horizon to invest in equity mutual funds…

Historical nifty 50 rolling returns data suggests that if you invest in more than 7 years, the chances of getting a positive return are 100%.

So, do not invest in equity mutual funds if your financial goal is less than 7 years.

In addition, you can still invest in equity mutual funds for less than 7-year goals.

But you should be careful about the volatility risk involved in it.

You should buy at low and should sell at high in mutual funds…

You know that in stock market investment, you need to buy at low and sell at high to get the profit or ROI from your investment.

But most investors tend to buy at high valuations and sell at low valuations due to lack of knowledge, fear, and greed.

In addition, you need to have a good tool to capture these equity index valuations.

So that you can maximise your ROI from your investments.

You should find ways to decrease the capital gain taxes…

When you sell your mutual funds, you need to pay short-term or long-term capital gain taxes.

But for risk-adjusted returns, you must do rebalancing frequently.

So, find mutual fund schemes in such a way that you need to do rebalancing less number of times and pay less capital gain taxes.

No one can do everything…

No one can learn everything; everything cannot become 100% perfect in everything.

You need to spend some time gaining knowledge about these investments in mutual funds.

In addition, you need to act right at the right time without emotions in the investment journey.

And fear and greed will play an important role in investor success or failure.

Finally, discipline and patience are also important for your successful investment journey.

And in your wheel of life, in daily life you need to spend time for work, sleep, travel, family, etc.

So, check your wheel of life before starting your investment journey on your own.

Best mutual funds to invest in 2025…

• Uti nifty index fund—direct plan—growth.
• Motilal oswal nifty midcap 150 index fund—direct plan—growth.
• Navi ELSS tax saver nifty 50 index fund—direct plan growth.
• Icici pru India equity fof direct plan growth.
• Icici pru constant maturity gilt fund.
• Nippon India passive flexi cap fof—direct plan—growth.

Conclussion…

I have tried to explain the right process to invest in mutual funds.

In addition, you need to connect all the dots and do your own research before starting to invest in the funds that I have suggested above in 2025.

Read the article about How time value of money will you in taking the right decisions?…

Also read about Why real estate is a bad investment?…

And read about Best SiP Date in Mutual Funds…

Also read about high-returning mutual funds—all you need to know…