10 Best Lumpsum Mutual Funds in India to Invest in April 2023
Lump sum mutual fund investments involve making a single, bulk deposit in a mutual fund scheme as opposed to investing small amounts over a long time via Systematic Investment Plans (SIPs). Lump sum investments are ideal for seasoned investors with a high risk appetite. So, if you’re planning to invest in a lump sum, check out our list of 10 best lump sum mutual funds to make an informed investment decision.
Top 10 Mutual Funds for Lump Sum Investments
Here are the best lumpsum mutual funds 2023 in India that you can invest:
| Mutual Funds for Lump sum Investment | Features |
| Navi Nifty 50 Index Fund | NAV: ₹11.05 AUM: ₹663.07 Crore Expense Ratio: 0.06% |
| Quant Tax Plan – Direct Plan-Growth | NAV: ₹246.69 AUM: ₹ 2779.06 Crore Expense Ratio: 0.57% |
| Mirae Asset Tax Saver Fund – Direct Plan-Growth | NAV: ₹30.20 AUM: ₹14043.25Crore Expense Ratio: 1.7% |
| BOI AXA Tax Advantage Fund – Direct Plan-Growth | NAV: ₹97.04 AUM: ₹676.9 Crore Expense Ratio: 2.53% |
| Canara Robeco Equity Tax Saver – Direct Plan-Growth | NAV: ₹112.94 AUM: ₹4685. 85 Crore Expense Ratio: 2.01% |
| IDFC Tax Advantage (ELSS) Fund – Direct Plan-Growth | NAV: ₹98.70 AUM: ₹4024.37 Crore Expense Ratio: 1.98% |
| PGIM India ELSS Tax Saver Fund – Direct Plan-Growth | NAV: ₹24.09 AUM: ₹451.01 Crore Expense Ratio: 2.52% |
| Kotak Tax Saver Scheme – Direct Plan-Growth | NAV: ₹73.97 AUM: ₹3167.04 Crore Expense Ratio: 2.18% |
| DSP Tax Saver Fund – Direct Plan-Growth | NAV: ₹87.91 AUM: ₹10317.34 Crore Expense Ratio: 0.82% |
| Union Long Term Equity Fund – Direct Plan-Growth | NAV: ₹80.185 AUM: ₹10129.21Crore Expense Ratio: 1.78% |
Disclaimer: Mutual fund investments are subject to market risks, read all scheme related documents carefully.
Also Read
Performance of Best Lumpsum Mutual Funds in India 2023
In the following section, we will provide the details of the best lump sum investment plans:
Considered as one of the best lump sum mutual funds, this scheme was launched on July 15, 2021, with the aim to earn returns equivalent to the Nifty 50 index by investing in its underlying stocks subject to tracking error. Aditya Mulki is the current fund manager of this scheme. This scheme also has 99.28% investment in domestic equities from which 85.2% are in large cap or blue chip companies.
- NAV: ₹11.05
- AUM: ₹663.07 Crore
- Expense Ratio: 0.06%
- Risk: Very High
- Minimum Investment: SIP ₹10, Lump Sum ₹10
- Type of Fund: Index Fund
- Annualised 1 Year Return: 6.8%
- Annualised 3 Year Returns: NA
- Annualised 5 year Returns: NA
2. Quant Tax Plan – Direct Plan – Growth
This scheme was incorporated on January 7, 2013, primarily for investors with a high-risk appetite. It aims for capital appreciation by monthly investing in equity shares. This is also an equity-linked savings scheme (ELSS), which means you can get tax deductions under Section 80C from investing. Ankit Pandey and Vasav Sehgal are the fund managers handling this scheme.
- NAV: ₹246.69
- AUM: ₹ 2779.06 Crore
- Expense Ratio: 0.57%
- Risk: Very High
- Minimum Investment: SIP ₹500, Lump Sum ₹500
- Type of Fund: ELSS
- Annualised 3 Year Returns: 48.53%
- Annualised 5 year Returns: 20.65%
3. Mirae Asset Tax Saver Fund – Direct Plan – Growth
Mirae Asset Mutual Fund incorporated this scheme on December 28, 2015. Neelesh Surana is the fund manager handling this scheme. This scheme is fit for investors who are planning long-term investments for at least 3 years. One can also enjoy the benefits of tax deductions of up to ₹1.5 lakh in a financial year by investing in this fund. Investors may also earn high returns by investing in equity and equity-related instruments under this scheme.
- NAV: ₹30.20
- AUM: ₹14043.25Crore
- Expense Ratio: 1.7%
- Risk: Very High
- Minimum Investment: SIP ₹500, Lump Sum ₹500
- Type of Fund: ELSS
- Annualised 2 Year Return: 9.00%
- Annualised 5 Year Returns: 14.08%
- BOI AXA Tax Advantage Fund – Direct Plan – Growth
The Bank of India Tax Advantage Fund was launched on January 2, 2013, and it has generated 16.53% annualised returns since then. Alok Singh is its present fund manager. People with long-term investment plans for 3 years or more can invest in this scheme for high returns and tax benefits. This scheme focuses on capital generation by portfolio diversification by investing in equity and equity-related instruments across the market.
- NAV: ₹97.04
- AUM:₹676.9 Crore
- Expense Ratio: 2.53%
- Risk: Very High
- Minimum Investment: SIP ₹500, Lump Sum ₹500
- Type of Fund: ELSS
- Annualised 3 Year Returns: 29.20%
- Annualised 5 year Returns: 14.08%
5. Canara Robeco Equity Tax Saver – Direct Plan – Growth
The Canara Robeco Equity Tax Saver was launched for investors on January 2, 2013. Shridatta Bhandwalder and Vishal Mishra are the present fund managers. 59.95% of its investments are in large-cap stocks while 14.89% is invested in mid cap stocks and 5.94% is invested in small cap stocks. This fund is suitable for investors looking for long-term capital appreciation and tax deductions.
- NAV: ₹112.94
- AUM: ₹4685. 85 Crore
- Expense Ratio: 2.01%
- Risk: Very High
- Minimum Investment: SIP ₹500, Lump Sum ₹500
- Type of Fund: ELSS
- Annualised 3 Year Returns: 27.59%
- Annualised 5 year Returns: 14.33%
6. IDFC Tax Advantage (ELSS) Fund – Direct Plan – Growth
IDFC Mutual Funds incorporated this scheme for investors on January 2, 2013. Daylynn Pinto is the fund manager looking after this scheme’s performance. This scheme invests in domestic equities throughout the market capitalisation. It invests 51.52% in large cap funds, 12.86% in mid cap funds and 20.83% in small cap funds. There is a lock-in period of 3 years in this scheme. Therefore, investors with long term investment goals can invest here to earn high returns along with tax-saving benefits.
- NAV: ₹98.70
- AUM: ₹4024.37 Crore
- Expense Ratio: 1.98%
- Risk: Very High
- Minimum Investment: SIP ₹500, Lump Sum ₹500
- Type of Fund: ELSS
- Annualised 1 Year Return: 0.72%
- Annualised 3 Year Returns: 32.14%
- Annualised 5 year Returns: 11.86%
7. PGIM India ELSS Tax Saver Fund – Direct Plan – Growth
PGIM India Mutual Funds launched this scheme on December 11, 2015. Utkarsh Katkoria and Srinivas Rao Ravuri are the present fund managers of this scheme. This is an equity-linked savings scheme (ELSS) and it’s suitable for investors with long-term investment plans. It invests 95.26% in domestic stocks across large, mid and small cap companies. Furthermore, 0.22 of this fund’s investment goes towards debt funds that predominantly include government securities.
- NAV:₹24.09
- AUM: ₹451.01 Crore
- Expense Ratio: 2.52%
- Risk: Very High
- Minimum Investment: SIP ₹500, Lump Sum ₹500
- Type of Fund: ELSS
- Annualised 1 Year Return: 0.50%
- Annualised 3 Year Returns: 13.74%
- Annualised 5 year Returns: 12.28%
8. Kotak Tax Saver Scheme – Direct Plan – Growth
This scheme was launched on January 2, 2013. Harsha Upadhaya is the present fund manager of this scheme. This mutual fund scheme invests 97.61% of its funds in domestic equities that include large, mid and small cap stocks. Kotak Tax Saver Scheme aims for capital appreciation by investing in a variety of equities and equity-related instruments. Investors can avail income tax benefits of up to ₹1,50,000 in a year by investing in this fund.
- NAV: ₹73.97
- AUM: ₹3167.04 Crore
- Expense Ratio: 2.18%
- Risk: Very High
- Minimum Investment: SIP ₹500, Lump Sum ₹500
- Type of Fund: ELSS
- Annualised 1 Year Return: 2.28%
- Annualised 3 Year Returns: 28.97%
- Annualised 5 year Returns: 13.18%
9. DSP Tax Saver Fund – Direct Plan – Growth
This scheme was launched on January 1, 2013, and it has generated 16.44% in annualised returns since inception. Rohit Singhania and Kushal Maroo are the fund managers handling this scheme. It invests 60.74% in large cap stocks, 17.4% in mid cap stocks and 7.55% in small cap stocks. This fund is also suitable for investors looking for long term investments, preferably 3 years or more with tax benefits.
- NAV: ₹87.91
- AUM: ₹10317.34 Crore
- Expense Ratio: 0.82%
- Risk: Very High
- Minimum Investment: SIP ₹500, Lump Sum ₹500
- Type of Fund: ELSS
- Annualised 1 Year Return: 0.15%
- Annualised 3 Year Returns: 29.58%
- Annualised 5 year Returns: 12.42%
10. Union Long Term Equity Fund – Direct Plan – Growth
This mutual fund scheme was launched on January 1, 2013. Vinay Paharia and Sanjay Benbalkar are the fund managers operating this scheme. Individuals looking for long term investment planning for a minimum of three years can choose this scheme. By investing here, one can enjoy high capital returns along with tax benefits. Investors must have a high-risk appetite to bear moderate losses while investing in this scheme.
- NAV: ₹80.185
- AUM: ₹10129.21Crore
- Expense Ratio: 1.78%
- Risk: Very High
- Minimum Investment: SIP ₹500, Lump Sum ₹500
- Type of Fund: ELSS
- Annualised 1 Year Return: 0.37%
- Annualised 3 Year Returns: 28.87%
- Annualised 5 year Returns: 12.40%
Features of a Lump Sum Investment
1. Investment Amount
Individuals choosing the best mutual funds for lump sum investments can make a single investment with a minimum amount of Rs.5,000. After the initial lump sum investment in the scheme, one can make subsequent investments in multiples of Rs.1,000.
2. Investment Horizon
An individual investing in lump sum equity funds can consider a long-term investment horizon for wealth appreciation. Alternatively, one might consider putting the lump sum investments in other types of mutual fund schemes, such as a liquid fund, to fulfil short-term investment goals.
3. Market Volatility
Considering the bullish and bearish market trend, investors might want to invest a lump sum amount in mutual funds and hold on to it for a longer period. The benefits of this investment mode are pronounced during low market periods. This is because one can buy more units owing to the lower NAV and sell them later on when the NAV increases, thus making substantial financial gains.
Benefits of Lump Sum Investments
Here are some of the benefits of lump-sum investments in mutual funds:
1. Ability to Invest a Substantial Amount for Growth
One can invest a big amount in a mutual fund scheme through this investment mode. The value of the investment increases significantly during a period of market growth.
2. Convenience
On investing through this mode, individuals need not be required to keep track of the investment dates. Furthermore, they do not need to have a certain amount in their bank account every month to invest.
How to Invest in a Lump sum in Mutual Funds?
Online Process
You can invest in lump sum mutual funds via online or offline.
1. Investing through AMC’s website
- Step 1
Visit the official website of the AMC
- Step 2
Fill in the required details
- Step 3
Provide your Aadhaar card and PAN card details and complete the e-KYC.
2. Investing through a mobile application
Step 1: Download the respective mobile application
Step 2: Provide your contact details to register
Step 3: Complete the e-KYC process
Once your application is verified and approved, you can start investing in a lump sum.
Offline Process
Alternatively, you can also invest offline – here’s the step-by-step process:
Step 1: Contact a representative of the fund house or an empaneled distributor.
Step 2: Procure application and KYC form (if KYC procedure not completed) from the fund house’s website.
Step 3: Fill the application/KYC (if applicable) form, provide necessary information i.e. name, address, PAN, email address, mobile number, etc. This email address and mobile number will be used for further communication, and can also be used to register for online transaction services.
Step 4: Attach copies of relevant documents and submit them along with a cheque or demand draft of the desired investment amount.
Step 5: Submit duly signed application/KYC (if applicable) form(s), with the cheque and all relevant documents, to any branch of the fund house or point of acceptance.
Step 6: The fund house will then allocate and provide you a folio number for that particular investment. You will also receive an Account Statement, after the transaction is processed.
However, offline applications could be extremely time consuming. The better alternative is to invest online.
Risks Associated with Lump Sum Mode of Investment in Mutual Funds
If you are confused about which mode will suit the best for your investment plan, you should consider the following factors to make up your mind:
- The timing of your investment should be one of your main concerns for the mode of investment. If you are planning to invest in a lump sum and the market is volatile, then your portfolio value will get significantly affected.
- While you chose an investment plan, the main purpose of doing so is wealth creation. If you invest through a lump sum, you might not get that money in the time of need. So, if there is any possibility of emergency funding in near future then you might not want to invest through lump sum mode.
Also Read
Differences between SIP and Lump Sum
- Investors comfortable with one-time investment might consider the lump sum mode. However, one might choose to make periodically fixed or variable investments by opting for a systematic investment plan (SIP).
- The investment horizon for lump sum mode might depend on an individual’s goals and market trends. For instance, in the case of a downtrend, opting for the best lump sum mutual fund investment might generate substantial benefits and vice versa. In the case of SIP investments, the tenure usually depends on investment goals only.
- Costs of lump sum investments are generally higher than SIPs as one usually needs to allocate at least Rs.5,000 to a scheme as the initial amount of investment.
- Unlike SIPs, lump-sum investments do not offer the benefit of rupee cost averaging to investors.
How to Choose the Best Mutual Fund for Lump sum Investments?
Consider the following factors before investing in a lump sum:
1. Fund Performance
It’s advisable to do thorough research on a fund’s performance before investing. Check reviews, returns in the last 3 and 5 years, etc. Based on these parameters, start planning to invest in a lump sum.
2. Investment Goals
Know your investment goal before you put your money to work. Different investors have different goals. If you’re thinking short-term, you could go with active funds. Choose funds that are known for short-term returns. Similarly, for the long-term, you could go for some of the best index funds in the market. Again, do ample research before investing.
3. Cost of Funds
Active mutual funds cost more than passive funds. However, in order to diversify your portfolio, you could invest in both, maybe opt for SIP for one and invest in a lump sum for the other. Check the total expense ratio in mutual funds before investing to enjoy the full value of your investments.
Factors to Consider before Investing Lump Sum in Mutual Funds
However, mutual funds are linked to the market hence there is some degree of risk involved. The following pointers talk about factors you should consider before investing in lump sum:
1. Financial Stability
As investors need to pay a substantial amount in case of this investment mode, they might want to consider their financial situation before investing.
2. Risk Appetite
Before investing in equity funds through the lump sum mode, one might want to consider their risk profile. After all, their investments in the schemes are subject to market fluctuations. A substantial investment in a fund through this mode might lead to huge losses if an investor does not account for the market volatility.
3. Investment Goals
One might want to consider his/her financial goals before choosing to invest via the lump sum mode.
Taxation of Lump Sum Mode of Investment in Mutual Funds
The taxation on lump sum investments depends on the type of mutual fund and the holding period.
1. Equity Mutual Funds
If an individual holds equity mutual funds for more than 1 year, they are eligible for Long-Term Capital Gains (LTCG) tax, which is taxed at 10% on gains exceeding ₹1 lakh in a financial year. If an individual sells equity mutual funds within 1 year of purchase, the gains are treated as Short-Term Capital Gains (STCG) and taxed as per the individual’s income tax slab rate. Any gains below ₹1 lakh are exempt from tax.
2. Debt Mutual Funds
If an individual holds debt mutual funds for more than 3 years, they are eligible for LTCG tax, which is taxed at 20% with indexation benefits. If an individual sells debt mutual funds within 3 years of purchase, the gains are treated as STCG and taxed as per the individual’s income tax slab rate.
It’s important to note that the tax laws are subject to change and it’s advisable to consult with a financial advisor or tax expert for the latest information and to ensure compliance with tax laws.
Final Word
Invest in a lump sum only if you have the desired risk tolerance. However, you can balance out the potential risks by investing both in lump sum and via SIP. As a matter of fact, if you’re a beginner investor, start small to mitigate the potential risks. Select the best lump sum mutual funds 2023 based on your investment objective and risk appetite.
For example, with Navi Mutual Fund you can invest in a diverse range of funds, including Nifty 50, US Total Stock Market Fund pf Fund and NASDAQ 100, among others, with as low as ₹10!
FAQs
Lump sum investment in mutual funds might be suitable for individuals who are aware of the market valuations. Generally, investments in lump sum mode during high market trends might lead to lower returns in future. Alternatively, one can benefit from these investments when the valuations are low.
A systematic Investment Plan is an investment mode where an individual can invest a fixed sum at regular intervals, for example, on a quarterly, monthly or half-yearly basis. The investment cost is lower in SIPs, meaning one can start investing with a low amount such as Rs. 500. By opting for this mode, investors can build a regular savings habit.
To compute the future value of your investments using a lump sum calculator, you must follow these steps:
– Enter the investment amount
– Choose the timeframe for which you wish to stay invested in a scheme (investment duration)
– Enter the expected rate of return
– Once you enter these details, the lump sum calculator will compute your estimated returns. Moreover, it will show the total investment value at the end of the investment time period.
Investors must take certain factors into consideration when choosing a mutual fund scheme for lump sum investment:
– Risk appetite
– Investment goal
– Past returns
– Fund managers’ experience
– Investment time horizon
Besides these, it is vital to compare the expense ratio of the schemes before making a decision.
Investors can enjoy the following benefits by using a lump sum calculator:
-It shows the estimated returns for the investment duration.
-This online tool enables investors to manage their finances more efficiently as they get to know the estimated returns at the end of the investment time period.
-It is easier for individuals to compute the estimated returns using a lump sum calculator as they can avoid manual calculations.
While going for mutual fund investment, you have to choose between lump sum or SIP mode of investment. You can consider the following points if you want to choose lump sum over SIP investment.
– Growth: Through the lump sum mode of investment you invest a large amount. While there is a risk of loss if the market goes down, you can also benefit largely while the market is going upwards.
– Benefit of compounding: If you invest through lump sum and stay invested for a long time, you will benefit to a great extent through the power of compounding.
Ans: Lump sum investments are good when you are investing when the market is down. Also, it is fit for investors with high-risk appetite as market volatility impacts their returns from lumpsum investment. Therefore, one must monitor the stock market closely before and during investing.
Profits from mutual funds are taxable regardless of whether you have invested via SIP or lump sum mode. You will be taxed according to the holding period of your debt or equity securities. For equity funds, gains above ₹1 lakh for a holding period of more than 1 year is taxed at 10% while gains above ₹1 lakh for a holding period of less than 12 months is taxed at 15%. For debt funds, if the mutual fund units are held for more than 3 years, they are eligible for LTCG tax, which is taxed at 20% with indexation benefits. If the holding period is below 3 years, the gains are treated as STCG and taxed as per the income tax slab rate.
The returns from both lump sum and SIP investments in mutual funds depend on several factors, including the market sentiment, the price movement of assets and the state of companies and industries where the fund has invested. SIPs work better in unfavourable markets whereas lump sum brings in larger returns when the market returns to a steady condition.
Want to put your savings into action and kick-start your investment journey 💸 But don’t have time to do research? Invest now with Navi Nifty 50 Index Fund, sit back, and earn from the top 50 companies.
Disclaimer: Mutual Fund investments are subject to market risks, read all scheme-related documents carefully.
This article has been prepared on the basis of internal data, publicly available information and other sources believed to be reliable. The information contained in this article is for general purposes only and not a complete disclosure of every material fact. It should not be construed as investment advice to any party. The article does not warrant the completeness or accuracy of the information and disclaims all liabilities, losses and damages arising out of the use of this information. Readers shall be fully liable/responsible for any decision taken on the basis of this article.
