A Systematic Investment Plan (SIP) allows an investor to invest a fixed amount regularly in a mutual fund scheme. Instead of trying to time the market, SIP inculcates financial discipline and helps reduce the impact of market volatility through Rupee Cost Averaging.
Key Benefits of SIP:
- Power of Compounding: Returns generated on your investments start earning returns themselves.
- Rupee Cost Averaging: You buy more units when prices are low and fewer units when prices are high.
- Flexibility: Start with as low as ₹500 per month and increase/stop anytime.