Systematic Investment Plants (SIP)
Some of the biggest names and companies today started from the bottom. Some stories will also tell you that they started off with just Rs. 100 in their pockets. However, some of the popular names were born with a golden spoon. When it comes to the stock markets, the well known names shot to fame due to their analytical power. Moreover, they have always been bullish. Some of the traits of financially stable people include, avoiding the noise, staying invested in rough times and investing on a regular basis. A question may arise about the modes of investments. By regular investments its always a safer and a more prosperous option to invest in a SIP.
Furthermore, systematic investment plans do not require you to track the market. Investing in an SIP means cutting off on major risks and accumulating money wisely. Sometimes we may want to take up investing activities that involve investment of a lump sum amount. While investing in lump sum mutual funds may fetch you a good return, it doesn’t necessarily mean it may reduce your risk. The wholesome amount may sometimes be put entirely into equity or debt. This may not suit your risk profile or risk taking capacity.
What is most advisable?
This is why we advice our young investors to indulge in SIP’s. One can invest in SIP’s as and when they receive their salaries or regular income. In fact this also helps as a regular investment as it may sometimes give you a greater values overtime. Every month is a unique one. While one month may have a bullish trend, another may have a bearish trend.
Anyway, a person that holds on to SIP benefits either way. This is because when the market becomes bullish you remain in profits and accumulate a few more units of the SIP’s. During bearish markets your profits may definitely make a dip but your capacity to hold more number of units increases with the same value of investment. This is why SIP’s may be small in size initially, but overtime by gathering SIP units they yield highly balanced financial potentials. One must also keep in mind that approaching a financial advisor may help strategies one’s investments better.
Also Read: Benefits of Staying invested!