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A quick and easy 5-step guide to understanding systematic investment plans

Invest a small amount regularly with systematic investment plan and watch your wealth growing gradually. Choose from available SIP investment plan and start investing.

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A quick and easy 5-step guide to understanding systematic investment plans

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  1. A quick and easy 5-step guide to understanding systematic investment plans

  2. Introduction • Have you ever wondered how you can cultivate the positive habit of savings via investing as well as maximize your income generation at the same time? If so, then you might want to turn your attention toward systematic investment plans (SIPs). An SIP investment planallows you to invest in mutual funds at regular intervals. The policyholder is allocated certain units at the current market price in exchange for a fixed amount that is debited from their account either monthly, quarterly or weekly.

  3. SIP investment plan has become a popular choice in India amongst investors, especially following the landmark event of demonetization in the nation. But post you join in on the whole deal, there are a few facts that you must know about. 

  4. A systematic investment plan is not a product by itself. Thus, it goes without saying that SIPs and mutual funds are not synonymous terms. SIP investment plan is a tool that helps policyholders in investing money in mutual funds. It plays a primary role in staggering one’s equity investments over a given time period. • Since it is generally advisable by experts to avoid investing lump sum amounts of money in equity mutual funds at one go, systematic investment plans specially cater to that interest and thus offer a much systematic way of investing.

  5. SIPs automatically impart a financial discipline in your life. Since your money is auto-debited from your account at fixed intervals, you can ensure that a portion of your income gets systematically invested in the market without you having to worry about the market conditions, updating transactions in your online demat account, prevailing index levels, etc. 

  6. SIP investment plan works in a way that helps investors in averaging their purchase cost while also maximizing their returns on a long-term level. Since this tool helps to regularly maintain a fixed investment amount, irrespective of the market conditions, investors have the possibility of earning both high and low units. On a long-term basis, this helps to average out the purchase cost of your individual mutual fund units.

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