SIP - Systematic Investment Plan refers to an organized and disciplined approach of having a Mutual Fund Investment. With this you can make small portions of your savings reap significant returns if followed in a periodic fashion for a reasonable duration.
Benefit : Rupee Cost Averaging
i.e. Higher the Net Asset Value (NAV) - Lower the Units you get
Lower the Net Asset Value (NAV) - Higher the Units you get
Oppurtunity : Make use of the fluctuations in the Market
Ideal Combination :
- Scheme : Equity Diversified (May vary based on ur choice)
- Type : Open Ended (Preferably)
- Fund Allocation : Say Rs. 500/- (minimum or as per the scheme details)
- Period : Monthly Basis (Ideal)
- Date : within 5 days of Receiving ur Salalry ( i.e 5th of the Month)
- Option : Dividend Payout ( To enjoy the fruits periodically)
- Mode of Payment: ECS (electronic Clearing Scheme)
- Term : Min 3 Years
... Then wait and watch the Power of Compounding...
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