What is an SIP?

An SIP, or a Systematic Investment Plan is a mode of investment in Mutual Fund whereby the investor invest a pre-determined amount on a monthly basis, on a pre-determined date, into any particular scheme.

Why SIP.?

1. One may ask that if it is just another mode of investing, then why SIP is so much popular. The reason lies in the number of benefits that an SIP gives to the investors. Some of the benefits are:
2. • Benefit of Rupee Cost Averaging
3. Since you're buying at the regular pre-determined fixed dates of every month, you'll be buying at dips and rises, so you are averaging your cost over the time period.
4. • Helps you avoid panic selling
5. SIP investors doesn’t invest lump sum amount and tend to scare less easily when the markets fall – as they get the chance to buy low.
6. • Small amount can be invested
7. you need not have a large amount of money to start an SIP; you can start with as little as Rs. 500 per month, in some cases even Rs. 100 per month and slowly build up your wealth.
8. • You need not time the market
9. As the concept of SIP is to regularly invest the fixed amount on specified dates, the investor need not actually have to time the market. The units are purchased on both rise and fall and investors get the rupee cost averaging benefit.