Index Fund Systematic Investment Plan

Index Fund SIP (Systematic Investment Plan) Investment has emerged as a popular and efficient way for investors to participate in the financial markets and build long-term wealth. It combines the benefits of index funds, which offer broad market exposure, with the disciplined and gradual approach of SIPs, providing you with a hassle-free and cost-effective investment strategy.

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SIP Plan Benefits
Start SIP with as low as ₹1000
Start SIP with as low as ₹1000
No hidden charges
No hidden charges
Save upto ₹46,800 in Tax
Save upto ₹46,800 in Taxunder section 80C^
Zero LTCG Tax
Zero LTCG Tax
Disciplined & worry-free investing
Disciplined & worry-free investing

  • Insurance Companies
  • Mutual Funds
Returns
Fund Name 5 Years 7 Years 10 Years
High Growth Fund Max Life
Rating
33.56% 19.72%
16.82%
View Plan
Top 200 Fund Tata AIA
Rating
33.06% 20.69%
16.57%
View Plan
Accelerator Mid-Cap Fund II Bajaj Allianz
Rating
26.11% 11.93%
13.25%
View Plan
Opportunities Fund HDFC Standard
Rating
26.28% 13.34%
13.43%
View Plan
Growth Plus Fund Canara HSBC Oriental Bank
Rating
18.66% 9.86%
9.13%
View Plan
Grow Money Plus Fund Bharti AXA
Rating
23.24% 13.96%
12.71%
View Plan
Multiplier Birla Sun Life
Rating
27.71% 12.46%
14.1%
View Plan
Opportunities Fund ICICI Prudential
Rating
24.94% 12.68%
10.91%
View Plan
Flexi Growth Fund LIC
Rating
- -
-
View Plan
Virtue II PNB Metlife
Rating
23.2% 17.21%
15.2%
View Plan
Fund rating powered by
Last updated: Mar 2025
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  Returns
Fund Name 3 Years 5 Years 10 Years
Active Fund QUANT 23.92% 31.48%
21.87%
Flexi Cap Fund PARAG PARIKH 20.69% 26.41%
19.28%
Large and Mid-Cap Fund EDELWEISS 22.34% 24.29%
17.94%
Equity Opportunities Fund KOTAK 24.64% 25.01%
19.45%
Large and Midcap Fund MIRAE ASSET 19.74% 24.32%
22.50%
Flexi Cap Fund PGIM INDIA 14.75% 23.39%
-
Flexi Cap Fund DSP 18.41% 22.33%
16.91%
Emerging Equities Fund CANARA ROBECO 20.05% 21.80%
15.92%
Focused fund SUNDARAM 18.27% 18.22%
16.55%

Last updated: Feb 2025

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˜Top 5 plans based on annualized premium, for bookings made in the first 6 months of FY 24-25. Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by any insurer. This list of plans listed here comprise of insurance products offered by all the insurance partners of Policybazaar. For a complete list of insurers in India refer to the Insurance Regulatory and Development Authority of India website, www.irdai.gov.in

Buying the Dip Results in Higher ReturnsBuying the Dip Results in Higher Returns

What is Index Fund SIP Investment?

An Index Fund SIP Investment is a way to invest regularly in index funds. Index funds are a type of market-linked fund like ULIP funds, mutual fund^^ or Exchange-Traded Fund (ETF) that aim to replicate the performance of a specific market index, such as the S&P 500 or the NSE Nifty 50. These funds invest in a diversified portfolio of securities that mirror the composition of the chosen index. 

With the best SIP plans, you invest a fixed amount periodically in an index fund, making it a disciplined and hassle-free approach to growing your wealth over time. The main objective of index funds is to match the returns of the index they track rather than trying to outperform it actively. 

SIP Calculator

I want to invest Pro Tip
Financial experts suggest that a person should invest 10-15% of their monthly income for long-term financial growth
/Month
I want to invest for Pro Tip
Financial experts suggest that individuals should ideally invest for a period of 5 to 10 years, or even longer, to maximize the benefits of compounding and navigate market fluctuations effectively
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Expected return Pro Tip
Top 25% of investors consistently generate more than 12% return
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Total Wealth ₹22.4 L
View Plans
I want to save
I want to invest for Pro Tip
Financial experts suggest that individuals should ideally invest for a period of 5 to 10 years, or even longer, to maximize the benefits of compounding and navigate market fluctuations effectively
Years
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Expected return Pro Tip
Top 25% of investors consistently generate more than 12% return
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Monthly Investment ₹22.4 L
View Plans
Top Funds with High Returns (Past 7 Years)
High Growth Fund
16.82%
High Growth Fund
Top 200 Fund
16.57%
Top 200 Fund
Accelerator Mid-Cap Fund II
13.25%
Accelerator Mid-Cap Fund II
Opportunities Fund
13.43%
Opportunities Fund

Cost of Delay Calculator
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Monthly SIP Amount
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Invest For (in Years)
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Due to the delay of 10 Months

Your Target Wealth will reduce by 13.3%.

With loss of ₹13,87,249

Start TodayDelayed Start
Invest Now

Index Fund SIP Calculator

An Index Fund SIP Calculator helps you estimate the potential returns of your regular investments in an index fund. By entering details such as your monthly investment amount, investment duration, and expected rate of return, the calculator will provide a projection of your investment growth over time. The online SIP calculator is useful for planning and adjusting your investment strategy to meet your financial goals.

What are the Benefits of SIP Investing in Index Funds

Here are the benefits of Index Funds SIP investment:

  • Diversification: By investing in an index fund, you gain exposure to a broad range of stocks or bonds that constitute the underlying index. This diversification helps spread the risk and minimizes the impact of individual stock or sector performance on your overall investment.

  • Low Costs: Index funds are known for their cost-effectiveness. Since they aim to replicate an existing index rather than relying on active fund managers, they have lower management fees and expenses compared to actively managed funds.

  • Consistent Returns: Index funds tend to provide more consistent returns over the long term, as they are designed to follow the overall market trend. While they may not deliver extraordinary gains during bullish markets, they also offer protection during downturns.

  • Simplicity: Investing in index funds through a systematic investment plan (SIP) is a straightforward and hassle-free way to build wealth over time. It eliminates the need for constant monitoring and frequent decision-making, making it suitable for novice investors.

Why Choose Index Funds for SIP Investment?

  • Time-Tested Strategy: Index funds have proven to be a reliable investment strategy over the years. Many studies have shown that actively managed funds often fail to beat the market consistently, making index funds an attractive option for long-term wealth accumulation.

  • Lower Risk: As index funds are diversified across multiple stocks or bonds, the risk associated with individual securities is reduced. This makes them a safer option for risk-averse investors who seek stable and steady returns.

List of Investment Funds

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Selecting the Right Index Funds for Your Portfolio

Things to consider before investing in an index fund:

  • Consider the Index: Choose an index fund that aligns with your investment

  •  goals. For instance, if you seek exposure to the entire stock market, consider a broad-market index like the S&P 500. If you prefer a specific sector, you can opt for sector-specific index funds.

  • Expense Ratio: Compare the expense ratios of different index funds. Lower expense ratios mean higher returns for investors, as fees directly impact the overall performance of the fund.

  • Fund Size and Liquidity: Look for index funds with substantial assets under management (AUM) and high liquidity. Higher AUM indicates investor confidence, while liquidity ensures ease of buying and selling fund units.

  • Past Performance: While past performance does not guarantee future results, it can provide insights into the fund's historical behaviour. Compare the fund's performance against its benchmark index and peer group over various time frames.

NOTE: It is suggested that you use an index fund sip calculator to estimate the returns for your investment.

start-an-sip-today-watch-your-money-grow start-an-sip-today-watch-your-money-grow

Best Index Funds to Invest in SIP in India in 2025

Here are some of the best index funds to invest in India in 2025, along with their 1-year and 5-year returns:

Fund Name 1-Year Return 5-Year Return
Aditya Birla Sun Life Nifty 50 Index Fund 27.39% 19.43%
Bandhan Nifty 50 Index Fund 27.41% 19.80%
DSP Nifty 50 Index Fund 27.42% 19.47%
HDFC Nifty 50 Index Fund  27.36% 19.53%
ICICI Prudential Nifty 50 Index Fund 27.34% 19.60%
Motilal Oswal Nifty Midcap 150 Index Fund 47.14% 31.88%
Nippon India Index Fund 27.34% 19.55%
SBI Nifty 50 Index Fund 27.43% 19.46%
Tata Nifty 50 Index Fund 27.33% 19.54%
UTI Nifty 50 Index Fund 27.41% 19.63%

Disclaimer: ≈ Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by any insurer. This list of plans listed here comprise of insurance products offered by all the insurance partners of Policybazaar. The sorting is done in alphabetical order (Fund Data Source: Value Research). For a complete list of insurers in India refer to the Insurance Regulatory and Development Authority of India website, www.irdai.gov.in

*Returns updated as of September 2024.

These funds are all passively managed, which means that they track a specific index, such as the Nifty 50 or the Sensex. This makes them a good option for investors who are looking for a low-cost, low-risk way to invest in the Indian stock market.

Details of Index Fund SIP Investments in 2025

  1. Motilal Oswal Nifty Midcap 150 Index Fund

    The Motilal Oswal Nifty Midcap 150 Index Fund tracks the Nifty Midcap 150 index and offers investors exposure to a diverse range of midcap companies. It is an efficient option for those seeking to invest in India's midcap segment with a passive strategy.

    Features of Motilal Oswal Nifty Midcap 150 Index Fund:

    • Investment Objective: It aims to provide investors with returns that closely correspond to the performance of the Nifty Midcap 150 Index, focusing on mid-sized companies with growth potential.

    • Launched On: 10 September 2019

    • Benchmark Index: Nifty Midcap 150

  2. Bandhan Nifty 50 Index Fund

    The Bandhan Nifty 50 Index Fund provides you with exposure to the top 50 companies in India by tracking the Nifty 50 index. It offers a low-cost, passive investment option for long-term financial growth.

    Features of Bandhan Nifty 50 Index Fund:

    • Investment Objective: It seeks to replicate the Nifty 50 Index, offering investors exposure to the top 50 large-cap stocks in India, providing a diversified portfolio aimed at capital appreciation.

    • Launched On: 02 January 2013

    • Benchmark Index: Nifty 50 Index

  3. UTI Nifty 50 Index Fund

    The UTI Nifty 50 Index Fund offers you a low-cost, passive investment option that tracks the Nifty 50 Index. This fund provides exposure to India's top 50 companies.

    Features of UTI Nifty 50 Index Fund:

    • Investment Objective: The fund targets returns that mirror the Nifty 50 Index, allowing investors to gain access to a broad selection of leading Indian companies for stable growth.

    • Launched On: 28 March 2000

    • Benchmark Index: Nifty 50 Index

  4. ICICI Prudential Nifty 50 Index Fund

    The ICICI Prudential Nifty 50 Index Fund is a passive investment option that aims to replicate the performance of the Nifty 50 Index, which includes India's leading 50 stocks.

    Features of ICICI Prudential Nifty 50 Index Fund:

    • Investment Objective: It aims to track the performance of the Nifty 50 Index, offering investors a convenient way to invest in India’s leading large-cap stocks for long-term wealth accumulation.

    • Launched On: 26 February 2002

    • Benchmark Index: Nifty 50 Index

  5. SBI Nifty 50 Index Fund

    The SBI Nifty 50 Index Fund is designed to track the performance of the Nifty 50 Index, which represents the top 50 companies listed on the National Stock Exchange of India. The fund offers a simple and cost-effective way to invest in a diversified portfolio of India's leading stocks.

    Features of SBI Nifty 50 Index Fund:

    • Investment Objective: This fund seeks to provide returns aligned with the Nifty 50 Index, enabling investors to invest in a diversified portfolio of major Indian companies for potential capital growth.

    • Launched On: 11 January 2002

    • Benchmark Index: Nifty 50 Index

Risk and Returns in Index Fund SIP Index Fund Investment 

  • Market Fluctuations: Understand that index funds are subject to market fluctuations. While they aim to track the index, they will still experience volatility based on market sentiment and economic conditions.

  • Long-Term Approach: Index fund investing is best suited for long-term goals. Investors must stay invested through market ups and downs to benefit from the compounding effect and average out market fluctuations.

  • Historical Returns: Analyze the historical returns of the index fund you are interested in and set realistic expectations. Expecting exceptionally high returns can lead to disappointment and hasty decisions during market downturns.

People Also Read: Which Bank has the Highest Interest Rate for Fixed Deposit?

start-small-&-build-your-wealth-for-a-brighter-tomorrow start-small-&-build-your-wealth-for-a-brighter-tomorrow

Tips for Maximizing Returns with Index Fund SIPs

  • Consistency: Be consistent with your SIP contributions. Regular investing, regardless of market conditions, can help take advantage of rupee cost averaging and build substantial wealth over time. You can also use a SIP calculator to make smarter investment decisions.

  • Increase Contributions with Income Growth: As your income grows, consider increasing your SIP contributions. This will accelerate the growth of your investment and align it with your changing financial needs.

  • Avoid Frequent Switching: Stick to your chosen index fund and avoid frequent switching between funds. Continuously churning your investments can lead to unnecessary costs and lower overall returns.

  • Stay Informed: While index fund investing is relatively passive, staying informed about market trends and economic developments can help you make informed decisions and stay confident in your investment strategy.

Wrapping it up!

Index Fund SIP Investment is a reliable and straightforward approach to grow your wealth over time steadily. By understanding the basics of index funds, selecting the right ones, managing risk and expectations, and monitoring your investments, you can harness the potential of SIPs in index funds to achieve your long-term financial goals. Remember that discipline and patience are key to successful index fund SIP investing.

˜Top 5 plans based on annualized premium, for bookings made in the first 6 months of FY 24-25. Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by any insurer. This list of plans listed here comprise of insurance products offered by all the insurance partners of Policybazaar. For a complete list of insurers in India refer to the Insurance Regulatory and Development Authority of India website, www.irdai.gov.in
*All savings are provided by the insurer as per the IRDAI approved insurance plan. Standard T&C Apply
^The tax benefits under Section 80C allow a deduction of up to ₹1.5 lakhs from the taxable income per year and 10(10D) tax benefits are for investments made up to ₹2.5 Lakhs/ year for policies bought after 1 Feb 2021. Tax benefits and savings are subject to changes in tax laws.
¶Long-term capital gains (LTCG) tax (12.5%) is exempted on annual premiums up to 2.5 lacs.
++Source - Google Review Rating available on:- http://bit.ly/3J20bXZ
^^The information relating to mutual funds presented in this article is for educational purpose only and is not meant for sale. Investment is subject to market risks and the risk is borne by the investor. Please consult your financial advisor before planning your investments.
**Returns are based on past 10 years’ fund performance data (Fund Data Source: Value Research).

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