Systematic investment plan: Difference between revisions
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{{Short description|SIP investment}} |
{{Short description|SIP investment}} |
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{{refimprove|date=June 2018}} |
{{refimprove|date=June 2018}} |
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A '''systematic investment plan''' ('''SIP''') is an investment vehicle offered by many [[mutual fund]]s to investors, allowing them to invest small amounts periodically instead of [[lump sum]]s. The frequency of investment is usually weekly, monthly or quarterly.<ref name=SIP_TOI>{{cite news|title=What is a Systematic Investment Plan? How does it work?|url=http://timesofindia.indiatimes.com/business/mf-news/What-is-a-Systematic-Investment-Plan-How-does-itwork/articleshowhsbc/24862593.cms|accessdate=26 December 2014|work=[[The Times of India]]|date=29 October 2013}}</ref> |
A '''systematic investment plan''' ('''SIP''') is an investment vehicle offered by many [[mutual fund]]s to investors, allowing them to invest small amounts periodically instead of [[lump sum]]s. The frequency of investment is usually weekly, monthly or quarterly.<ref name=SIP_TOI>{{cite news|title=What is a Systematic Investment Plan? How does it work?|url=http://timesofindia.indiatimes.com/business/mf-news/What-is-a-Systematic-Investment-Plan-How-does-itwork/articleshowhsbc/24862593.cms|accessdate=26 December 2014|work=[[The Times of India]]|date=29 October 2013}}</ref><ref>{{Cite web |date=2024-05-14 |title=Mutual Fund SIP Calculator 2024 - The Invest Advisory |url=https://theinvestadvisory.com/mutual-fund-sip-calculator/ |access-date=2024-05-20 |language=en-US}}</ref> |
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==Overview== |
==Overview== |
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Revision as of 05:06, 20 May 2024
 | This article needs additional citations for verification. (June 2018) |
A systematic investment plan (SIP) is an investment vehicle offered by many mutual funds to investors, allowing them to invest small amounts periodically instead of lump sums. The frequency of investment is usually weekly, monthly or quarterly.[1][2]
Overview
In SIPs, a fixed amount of money is debited by the investors in bank accounts periodically and invested in a specified mutual fund. The investor is allocated several units according to the current Net asset value. Every time a sum is invested, more units are added to the investor's account.[1]
The strategy claims to free the investors from speculating in volatile markets by dollar cost averaging as the investor is getting more units when the price is low and fewer units when the price is high. In the long run, the average cost per unit is supposed to be lower.[1]
SIP claims to encourage disciplined investment. SIPs are flexible; the investors may stop investing in a plan anytime or may choose to increase or decrease the investment amount. SIP is usually recommended to retail investors who do not have the resources to pursue active investment.[1]
See also
References
- ^ a b c d "What is a Systematic Investment Plan? How does it work?". The Times of India. 29 October 2013. Retrieved 26 December 2014.
- ^ "Mutual Fund SIP Calculator 2024 - The Invest Advisory". 2024-05-14. Retrieved 2024-05-20.