That’s a tough question. I asked if ChatGPT had the answer. I got a response, but it contained the wrong information. I have given wrong answers many times. Finally, I apologize for providing incorrect information. When she hears 5,000 SIP in mutual funds, it may be a small amount to actually invest, but it is easy to save and invest. No one has an excuse not to save such a small amount. In this article How to earn 1 billion with 5,000 SIP in mutual funds. We also offer model mutual fund portfolios on how this can be achieved through SIP for low, medium and high risk investors.
Also read: ChatGPT recommends mutual funds to invest in in 2023
Generate 1 billion with 5,000 SIP on ChatGPT responses
When I asked ChatGPT, Is it possible to make 1 billion with 5,000 SIP in mutual funds? I answered that I need 30.67 years for a 12% return. I asked again. The company apologized and said it needed 38.67 years for a 12% return.
I got fed up and quit ChatGPT to continue my analysis.
How much money can you make with 5,000 SIP per month?
Historically, the stock market has generated 10% to 12% returns, depending on your risk appetite and investment horizon. Considering these earnings, investing 5,000 monthly through SIP can generate the following wealth:
10 year period – 1.03 million to 1.13 million
20 year period – 38.3 million to 5 million
30 year period – 1.1 billion to 1.75 billion
In other words, if you invest for 30 years, you can easily earn 10 billion yen. I know you’re not interested in waiting that long.
Is there another way to make a billion faster in mutual funds?
Also read: Can 50,000 SIP generate 10 billion rupees?
How can I use 5,000 SIP in Mutual Funds to generate 1 billion faster?
However, if you want to invest $5,000 in mutual funds every month and don’t want to wait until the 30-year term, let’s look at different scenarios on how to reach this goal faster.
Option 1 (5,000 SIP + 12% return + 10% increase in SIP annually) – You can generate 1 billion in 20 years. This is easy to achieve as salaried workers can get yearly raises and businessmen earn more yearly.
Option 2 (5,000 SIP + 15% return + 10% increase in SIP annually) – You can generate 1 billion in 18 years.
Expecting a 15% return through a mutual fund is a big deal, but investors can take a lot of risk to achieve this goal in the medium to long term.
When I say high risk, I’m not talking about money lost in futures, options or foreign exchange trading. What I’m talking about is investing in high-risk, high-return mutual funds, putting your emotions aside and waiting patiently until your goals are achieved.
Option-3 (5,000 SIP + 12% return + 20% SIP increase every year) – You can generate 1 billion in 15.8 years. don’t criticize me I just listed this as an option.
Option 4 (5,000 SIP + 15% return + 20% increase in SIP annually) – You can generate 1 billion in 15 years.
Again, a 15% return is very high, but still possible.
The scenario above is not for every investor, so you should check what suits you and proceed.
How can I maximize my investment income from mutual funds in India?
Here are the simple steps:
1) Choose the right mutual fund based on your risk appetite, holding period and financial goals.
2) Diversify investment in investment trusts. Do not invest in a single category of large-cap, mid-cap, and small-cap segments. It should be distributed across categories.
3) Invest for the long term. Keep monitoring daily without investing. If you fall into the category of daily monitoring, you have chosen the wrong investment option.
4) Invest regularly through SIP. Invest in lump sum whenever there is an annual bonus, annual or quarterly variable salary, etc.
5) Review the portfolio quarterly, or at least annually, to see how well the portfolio is performing compared to other portfolios. Make adjustments as needed.
Understanding mutual funds before jumping to the actual mutual fund list
Before diving into a list of mutual funds, you should understand the investment objectives and risk profiles of different mutual funds.
1) Large cap funds: These funds invest primarily in large-cap stocks included in the Nifty100. These funds offer stable returns over the medium to long term.
2) Mid Cap Funds: These funds invest primarily in mid-cap stocks (101st to 250th).th In terms of market capitalization. Stocks that fall into this portfolio could be future blue chip stocks. Therefore, returns from such funds are higher. On the one hand, these stocks are more volatile and riskier. Therefore, high-risk investors can invest in such mid-cap funds.
3) Small cap funds: These funds invest primarily in small caps, or 251 shares.cent Even from a market cap perspective. The stocks that fall into this portfolio may become mid-cap stocks in the future. Therefore, returns from such funds are higher. On the one hand, these stocks are highly volatile and, in some cases, highly illiquid, and thus carry a very high degree of risk. Only high-risk investors may invest in such funds.
Which mutual fund can generate $1 billion with 5,000 SIP?
Through the above analysis, we have come to the conclusion that an investor can generate 1 billion by investing 5,000 SIP every month in mutual funds for 15 to 20 years and the SIP value will increase every year.
Here are some portfolios of mutual fund models that you can consider and invest in based on your risk appetite.
Model portfolio of mutual funds for high-risk investors
The mutual fund portfolio consists of 1 large-cap fund, 2 mid-cap funds and 2 small-cap funds. More mid- and small-cap stocks were added to reach this goal faster, and fewer large-cap stocks to provide stability. Historical returns are indicative and can show where you land in terms of wealth. You can invest 1,000 SIP in each of these funds. Below are 5 mutual funds that offer annual SIP returns.
| scheme name | 3Y | 5 years | 10 years |
|---|---|---|---|
| Kotak Emerging Equity Fund | twenty two% | twenty two% | 20% |
| edelweiss midcap fund | twenty two% | twenty three% | 20% |
| Japan India Small Cap Fund | 34% | 30% | twenty five% |
| SBI Small Cap Fund | twenty three% | twenty four% | twenty three% |
| Japan India Large Cap Fund | twenty two% | 18% | 16% |
A model portfolio of mutual funds for medium to high risk investors
The mutual fund portfolio consists of one fund each from the Large Cap, Mid Cap, Small Cap categories and the Balanced Advantage Fund category. This portfolio is similar to his portfolio for all seasons, which works in all market scenarios. Historical earnings are an indicator, and this could be an indicator for reaching his billion goal. You can invest 1,250 SIP in each of these funds. Below are 5 mutual funds that offer annual SIP returns.
| funds | 3Y | 5 years | 10 years |
|---|---|---|---|
| Japan India Large Cap Fund | twenty two% | 18% | 16% |
| Kotak Emerging Equity Fund | twenty two% | twenty two% | 20% |
| SBI Small Cap Fund | twenty three% | twenty four% | twenty three% |
| HDFC Balanced Advantage Fund | twenty one% | 18% | 15% |
What about moderate risk takers?
If you’re willing to take a moderate amount of risk, you can invest in large-cap or balanced-advantage funds. You can choose funds from the list above or previous articles in these categories.
Also read: 5 Mutual Funds That Return Up To 338% Over 3 Years
Can I become a Chlorepati with this money?
Historical performance is an indication of how such funds have performed over various market cycles, but is not a guarantee of return. Investing in 4-5 funds is more likely to achieve your goals than investing in 1-2 funds.
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