scorecardresearchMF Returns: Monthly SIP of ₹8,000 since the launch of this scheme would have swelled to over ₹1 crore; Check details

MF Returns: Monthly SIP of 8,000 since the launch of this scheme would have swelled to over 1 crore; Check details

Updated: 20 Dec 2022, 10:37 AM IST
TL;DR.
If someone had invested 8,000 each month since the launch of Quant Mid Cap mutual fund in Mar 2001, it would have swelled to 1.14 crore. We share more details about the magic of compounding
Sample this. If someone were investing  <span class='webrupee'>₹</span>8,000 a month consistently since the launch of Quant Mid Cap mutual fund on March 20, 2001, the accumulated wealth would have grown to more than  <span class='webrupee'>₹</span>one crore.

Sample this. If someone were investing 8,000 a month consistently since the launch of Quant Mid Cap mutual fund on March 20, 2001, the accumulated wealth would have grown to more than one crore.

Like all magics, the magic of compounding must be seen to believe it. Investing consistently over a long period of time can grow to become a vast amount of wealth.

Sample this. If someone were investing 8,000 a month consistently since the launch of Quant Mid Cap mutual fund on March 20, 2001, the accumulated wealth would have grown to more than one crore.

Since inception, this mutual fund scheme has given a CAGR (%) of 12.88 percent as on November 30, 2022. This means if someone had invested 10,000, it would have grown to 1,38,451 by now.

But when you keep investing a small SIP (systematic investment plan) of 8,000 every month, the mutual fund scheme would have given a compound annual growth return (CAGR) of 12.85 percent per annum, thus accumulating a whopping 1.14 crore by now.

Tenor                                                      Total amount investedAfter CAGR (Rs) 
5 years                                                                          4,80,0008,28,594
10 years                                                                      9,60,00024,28,712
15 years                                                                           14,40,00043,81,170
20 years                                                            19,20,00089,76,806
Since inception                                                      20,88,0001,14,16,300

[Based on CAGR as shown by AMFI for past 5 and 10 years, and 12.85% (i.e., returns since inception) for other tenors]

As one can see in the table above, the systematic investment plan (SIP) of 8,000 when invested for 5 years can swell to 8,28,594 after investing 4,80,000, giving a return of 20.04 percent.

Likewise, when you continue to make an investment for 10 years, the accumulated sum would have grown to 24,28,712 after investing 9,60,000, thus giving a CAGR of 16.38 percent.

Similarly, by investing only 14,40,000 over a period of 15 years, the investment would have grown to 43,81,170, giving a compound annual growth return of 12.85 percent.

And in 20 years, an investment of 19,20,000 would have grown to 89,76,806 and since inception – an investment of 20,88,000 would have swelled to 1,14,16,300.

Article
We explain the compound annual growth rate in this graphic.
First Published: 20 Dec 2022, 10:37 AM IST