Systematic Investment Plan
An SIP or a Systematic Investment Plan allows an investor to invest a fixed Amount regularly in a mutual fund scheme, Typically an Equity Mutual Fund Scheme.
Why should you SIP?
One, it imparts Financial Discipline to your Life. Two, it helps you to Invest regularly without Wrestling with Market Mood, Index level, etc. For Example, if you are supposed to put a fixed Amount every month in a Mutual Fund Scheme, you need to find time to do it. When you have the time, you might be worried about market conditions and think of postponing your investments. Or you Might
be Thinking of Investing more if the Mood is Optimistic. SIP puts an end ..
What are the other Benefits of SIPs?
SIPs help you to Average your Purchase Cost and Maximise Returns. When you Invest Regularly over a period Irrespective of the Market Conditions, you would get more units when the Market is Low and Less units when the Market is High.
This Averages out the Purchase cost of your Mutual Fund Units.
In Short - Why SIP?
1 Disciplined approach to investments
2 No need to time the market
3 Harness the power of two powerful Investment strategies:
.. Rupee Cost Averaging - Benefit from Volatility
.. Power of Compounding - Small investments create Big Kitty over time
4 Lighter on the wallet
5 Reap benefits of starting early
Secret to Achieving MuchMore With SIP
1 List Down your Dreams and Goals and Work out a Plan to Achieve Them through SIP
2 Ascertain the monthly/quarterly SIP required to achieve your goals
3 Identify the scheme(s) in which you would like to invest and complete the formalities for SIP investment including forms and cheques.
4 Invest for the long term as the twin benefits of power of compounding and rupee-cost averaging work through different market cycles
5 Diversify your Investments for your dreams through Multiple SIPs in Different schemes to Optimise Returns as per Your Needs
Harshita Tiwari BBA
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