Basic question regarding SIP

[kunalp123]

Hello,

I have invested in SIP with the below mutual funds:
HDFC top 200 - Rs. 4000 per month
HDFC Equity - Rs. 1000 pm
IDFC Top 100 - Rs. 1000 pm
IDFC Premier Equity Plan A Growth - Rs. 2000 pm
Reliance Regular savings - Rs 1000 pm
Birla Sun Life Equity - Rs 1000 pm

As of now the above mutual funds are recommended by many. Atleast 3 yrs have passed since their inception.
But as time goes, new funds keep coming in the market, which will be then recommended.

So, my query is that should we continue the SIP for these funds for 3 to 5 or more years or even more? How to decide till when to continue SIP, or to switch to new funds in the market if the above funds performance is not good? (Because its recommended to stay invested for 10 to 15 yrs in SIP).

Kindly advice.




Regards,
Kunal.

 

[KoolSIM]

Its a good idea to invest in equity diversified funds for at least 3 - 5 years. As long as your chosen funds are performing well, there is no question of you exiting from them soon and going on to other new darlings of financial advisors.

You should periodically review your fund's performance, by judging it with various other funds who share the same benchmark. A 3 - year past return should be a good starting indicator to judge your fund's performance. Also the benefits of compounding kick in only after you have maintained your SIPs over a longer period of time.