Systematic Investment Plan allows investors
to invest a small amount of money periodically. The investments can be
made quarterly or weekly or monthly and
hence do not cost huge amount at a time. SIP's are offered by mutual funds to
make the investment experience easier.
SIP's are beneficial
as they provide investors the benefit of rupee cost averaging and compounding.
There are various plans available under systematic investment plans. If you are
planning to invest in one, here are some best tips.
Best Tips to Choose the Perfect SIP Plan in India
When choosing a mutual fund, consider these
factors to make your decision smarter and safer. You can also get help from
your our Tarrakki investment advisory team to discuss the risks and returns on
every plan. This advice will help you make an informed decision in your
investment process.
- In order to make an informed decision, choose the mutual fund that is recommended by the Tarrakki App. Consult with the Tarrakki investment advisory team in detail. Do not hesitate to ask for all the information about the mutual fund.
- Verify that
the fund house you are choosing is reputed and has a good track record in
the various cycles of the market. You can get the details from your Tarrakki Investment Advisory team.
- When you are
just starting with the SIP's, avoid investing in mutual fund plans that are
risky. You can do this by avoiding highly volatile plans with lower
liquidity. Check the volatility feature on the Tarrakki
app.
- Check the
CRISIL or Morning star rankings of the mutual fund you are choosing.
- It is
important to consider the overall asset size and the corpus of the mutual
funds. Generally you should invest in the funds with corpus as high as Rs.
500 crore. This helps you in assessing the reliability of the fund house.
- Do not choose the fund house by looking at
their most recent performance. Instead look for
consistency in the performance of the house. You
should look at how consistent and stable
was the performance of the mutual fund for past 7 or 10 years.
Investors can start investing in SIP's at
any time. Apart from choosing mutual funds, it is important to choose the right
plan. Many SIP's calculators are available online to help the investors to
calculate the returns. Use the calculator to know the total value that you can
gain with the investment plans you are choosing.
The investor should also be determining how
much he or she wants to invest and what are the investment goals. It is
important to get a realistic idea of what your investment plan scenario will be
in the coming years. The best thing about SIPS is that your investment can
range from Rs. 100 to as high as you wish. Choosing the mutual funds and the
plan wisely will make your SIP's extremely beneficial for you.
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