What is SIP and what are its advantages?
Meet Ashish. With his salary hike, Ashish was determined to start saving. Ravi, Ashish’s colleague and an active trader with Angel One suggested SIP(Systematic Investment Plan). Ravi explained:
SIP or Systematic Investment Plan is a disciplined method of investing in mutual funds. You can build a portfolio by investing a fixed amount of money, say 1,000 rupees at regular intervals monthly quarterly or annually as convenient.
SIP offers many benefits:
It is wallet friendly and inculcates discipline and ideal for new investors
It is hassle-free: once initiated, the amount is deducted automatically through ECS.
You buy mutual fund units at various prices so you don’t have to worry about timing the market or market fluctuations. This helps you get better returns. In lump sum investments, you have to save for a period and then invest the amount. With SIP, Ashish starts getting returns from day one, experiencing the power of compounding at its best. To leverage these benefits, Ashish is now ready to start investing in SIP with Angel One.