SIP: SYSTEMATIC INVESTMENT PLANNING
IMPORTANT FEATURES OF SIP:
1. Finance your future dreams: The ultimate objective of investing is to achieve financial goals like buying a house or creating a corpus for your children’s future education. SIP can help you achieve these goals over a period of time through small but regular investments.
2. Become disciplined with savings: SIPs help you inculcate a regular saving habit as they require you to invest a fixed sum of money on a regular basis. Investing regularly in small amounts may often lead to better results than investing in a lump sum.
3. SIPs offer flexibility: SIPs offer you the flexibility to select an amount that you intend to invest. SIP is a simple, convenient and affordable way to invest for your future with as little as Rupees 500 every month.
4. Minimize your exposure to stock market volatility: Through a SIP, you have the option to invest regularly in equity markets irrespective of bull and bear phases. By investing a fixed amount every month you may be able to pick up more units when the prices are low and vice versa so that, over a period of time, the acquisition cost per unit may come down. This is called RUPEE COST AVERAGING.
5. Create wealth with the power of compounding: compounding is a disciplined investor’s best friend. A Systematic Investment Plan (SIP) is one of the most effective means to beat market volatility and benefit from the enormous power of compounding over time.