can anyone knows the advantages of investing in sip..?

Question

sip is systematic investment plan
monthly investment are done for a particular period of time

Answer 1

sip - you buy more when prices are down and buy less when prices are up.

http://www.masterandstudent.com/2008/08/what-is-sip.html

Answer 2

SIP has many advantages. Firstly it ensures that you regularly save. You might not have all the investment money at one time so as and when a small portion keeps going. Say for example you want to put Rs1200 in an investment. You need to collect the entire amount to put it which might come as a total at the end of the year. However each month if you keep putting in Rs 100 you will achieve your target easily. Most importantly the minute you put your first Rs 100 the return on that Rs 100 starts from then itself. SIP is advisable for all types of instruments. Debt,Equity. Options like PPF also it is good to systematically add money and not just a big dent in one go at the end of the year for tax savings. Similarly in stocks if your taking a Mutual fund or a tax saving ELSS if you do it each month then your investments get averaged out with the market fluctuations. All you need to do is set a date for your SIP and the money will go straight from your account each month. You can always add more than your SIP amount in your account also if you feel you can invest more in a particular month.

Answer 3

In short this is the best of the two worlds..can't imagine but you will be in advantage even if the market crashes. Its all the game of units. Take an example suppose you have started sip for one year amounting Rs 1000 p.m., which is generally for purchasing units of a particular fund say abcfund at some NAV.

And NAV is always changing, when the market goes down NAV of abcfund also slides and vice versa. So in jan if it was Rs 50 due to high rise in market you get 1000/50 i.e 20 units and suppose only after that month market crashes and the NAV is 10 you get 100units..and the process goes on then after one year your 12 month units will be added to get your overall units say if it is 200 units you can redeem these at the NAV prevailing for the redemption day.



So This is what you call SIP. Inverse of it you make Lumpsum investment i.e one time and you suffer with the market crashes if the market goes down..;but in case of SIP you take a advantage by getting more units at that time..so SIP is a way to make you a regular investor and not the slept one.

Answer 4

Advantages of SIP



1. Mobility

2. Unified Communications.

3. Increased Productivity

4. Reliability.

Answer 5

You need not spend time every time to investing. Once u decide the investment and choose the Sip every month ECS basis certain amt of money is deducted and goes to investment.. If u do not have commitment we will post pone the investments regularly. The main advantage is every month goes from bank acct.

Answer 6

hi , sip means systematic investment plan.ie a person on a monthly basis regularly invest say 5000 so after a long period of time he will have lumpsum in his hand with interest.he is burdenfree to invest all money at one time but regularly on systematic basis.