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What is SIP

• Systematic Investment Plan (SIP) is a disciplined way of investing.
• SIP is like RD a/c – same amount get invested every month
• SIP helps us to buy more when market is low and less when market is high
• SIP is considered to be one of the most efficient tool for wealth creation

How Does SIP Work?

• Every month a specified amount is auto debited from investor’s bank account and invested in selected mutual fund scheme
• Units will be allotted every time the amount is invested, based on the NAV of the scheme.
• Investor can redeem or switch out units partially or fully, anytime he/she wishes to do so.
• Each SIP installment is considered as a new investment; hence exit load will be applicable if you redeem your investment within the predefined time.

Benefit of Rupee Cost Averaging 

Effect of Compounding over Time

It’s Never too Late to Build a Fortune

Do’s while investing through SIP

• Give enough time for your money to grow
• To create wealth, do have a long term investment time horizon
• Align your SIP investments with your financial goals. Identify your goal – How to go from ‘where you are’ to ‘where you wish to be’.
• Based on your risk appetite, diversify your portfolio by investing in different categories of mutual fund
• Use Step up SIP feature to align your SIP amount with the increase in your income.

Don’ts while investing through SIP

• Don’t stop your SIPs when markets are falling, instead make additional purchase to average out the cost of purchase.
• Don’t try to time the markets by stopping SIP for a temporary period and restarting again, instead use the pause feature.
• Don’t switch to another fund just because the short term performance of the fund is low compared to its peers.

Key Messages

• Start early, Invest regularly & don’t interrupt the power of compounding.
• Compounding only works if you allow your investment to grow.
• See your money grow with the power of Systematic Investment.

Happy Investing. Click HERE to start your paperless investment today.