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Always Some Risk

Whether you invest in a debt, equity of hybrid mutual fund, there is always some risk associated with it…

I am a student and have `10,000 which I want to invest in SIPs with SBI Mutual Fund in a risk-free portfolio. What are my options?Sai Panda

It is heartening to note that as a student you have the maturity to explore investing in mutual funds. However, your question seems to suggest that you are a bit confused.
You say that you have Rs 10,000 which you want to invest. When you refer to a systematic investment plan (SIP), it means that you want to invest that amount at fixed intervals, either monthly or quarterly. Do you want to invest Rs 10,000 every month or just once at one go?
Secondly, you want a risk-free portfolio. Mutual funds are not risk-free investments. Whether you invest in a debt or equity fund, or a combination of both (hybrid fund), you are facing some amount of risk depending on the product in question.

If risk-free investment is what you desire, you will be better off with a bank fixed deposit or a government-backed investment like the National Savings Certificate (NSC). Here you can be sure of your capital being safe as well as earning a fixed return on your investment.
If you still want to go ahead with mutual funds, then we suggest you opt for a balanced fund. These are funds that invest in equity and debt and great for novice investors.
Which brings us to your request of investing in schemes of SBI Mutual Fund. Why would you limit your investment universe to only the schemes of this fund house when there are other better options around?
Now if you do decide to go ahead with a mutual fund, we suggest either DSP BlackRock Balanced or HDFC Prudence. Instead of investing Rs 10,000 at one go, open a monthly SIP of Rs 1,000 and invest the money over a period of 10 months.

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