what is systamatic investment plan how can i invest that?

Answer 1

A Systematic Investment Plan allows you to benefit from DCA, or Dollar Cost Averaging. It means you will invest the same amount at periodic intervals. Over time, you are guaranteed to own this investment at below the average price, since you will be buying more shares when the price is low, and less when the price is high. It is a great way to invest over time, and reduces your risk tremendously.

Answer 2

Systematic is the word that describes you. Organised, well-managed and planned in all your activities. Whether it is earning, saving or spending, everything is done in a methodical manner. Well… err… except for investing. But then you are not to blame. You never had enough money. Or, sometimes it was shortage of time. If this is the case, then it's time you had a look at the systematic investment plan (SIP) of mutual funds. A SIP is nothing but a planned investment programme, which takes a small sum of money from you and invests it in a mutual fund at regular intervals. The minimum amount can be as small as Rs 500 and the frequency of investment is usually monthly or quarterly. This simple programme has a number of advantages.

First, if saving is an arduous task for you, then SIP can do this for you. Money deducted from your account (through post-dated cheques) and invested is money you cannot spend. And a rupee saved is a rupee earned. Even if each investment is small, over time this can add up to a neat kitty. And the power of compounding can do wonders. In due course of time, a small amount can grow into a significant amount. More importantly, an SIP does away with the need or effort to time the market. When the market is falling you may feel that it may decline further and that you should wait a while. Often stock markets make a recovery before you notice and the opportunity is lost. When markets are rising it is scary to invest money. Isn't it better that you wait for a correction and then make an investment? But if the correction doesn't come about, then even this opportunity is missed. And if markets are going nowhere, then what is the point in investing at all?

So, trying to find out which is the best time to invest can be a tough task. And that's why it is said that timing the market is futile. If one could take advantage of the ups and downs that markets encounter, it would be great. And this is where SIP fits in. By the process of regular investing one gets to invest in the highs as well as the lows, and this helps in averaging out the volatility in the market.

Some mutual funds suggest that contribution to an SIP programme should be increased in a full-fledged bear market. While this may be emotionally difficult, it can be rewarding when markets recover. But then this appears very much like timing the market and the purpose of an SIP is to avoid this effort.

Thus, an SIP imparts discipline to investing. Whether it is the regular act of saving or investing, an SIP does both automatically. While there are certain benefits of an SIP please remember it is no wonder drug that cures all investment-related ailments.

An SIP does not guarantee returns or positive returns. If you opt for an SIP in a falling market and the market continues to fall, then your investments will suffer a loss on the whole. An SIP does not guarantee a better return than a one-time investment. If you made a one-time investment when the Sensex was at 2,834 points in October 2002, then this would have performed better as compared to carrying out an SIP by spreading the investment over a period of time.

The emphasis on averaging out in an SIP obviously makes it most useful in case of an equity fund, as the volatility is greater here. An SIP can be useful for a debt fund as well...to help build a pool of savings. It can be thought of something akin to a recurring deposit where a part of your savings is automatically deducted from your account.

Overall, an SIP is a simple device that helps you to save and invest in a disciplined manner without having to time the market.

Answer 3

Instead of investing once a year , systematic investment aims at same investment every month.

Advantage is that you do no not have to put all the money together and the ups and down ( the money you put in is invested in shares or other funds which keep fluctualing every time ) do not affect your investment. e.g. your monthly investment are put in the some scheme and that scheme will be low in some months where more shares can be obtained, some months it will be high so less shares can be obtained. It has been seen that at an average one tends to get more by systamitic investment.

You have to approach reputed fund managers or brokers to make your investment.

Answer 4

this is what i know
An SIP is a vehicle offered by mutual funds to help you save regularly.

It is just like a recurring deposit with the post office or bank where you put in a small amount every month. The difference here is that the amount is invested in a mutual fund.

The minimum amount to be invested can be as small as Rs 500 and the frequency of investment is usually monthly or quarterly.

How an SIP works

An SIP allows you to take part in the stock market without trying to second guess its movements.

AN SIP means you commit yourself to investing a fixed amount every month.
Let's say it is Rs 1,000.

When the NAV is high, you will get fewer units. When it drops, you will get more units.

Date NAV Approx number of units you will get at Rs 1,000
Jan 1 10 100
Feb 1 10.5 95.23
Mar 1 11 90.90
Apr 1 9.5 105.26
May 1 9 111.11
Jun 1 11.5 86.95
Within six months, you would have 5,894 units by investing just Rs 1,000 every month.

Let me know if u wana know more about this

Answer 5

systematic investment plan is a ode of investing in mutual funds

if you do it for long term about 10 or 15 years it will be benefitable

every month you will be investing it benefits when the market is low minimise the risk when market is high and is easy to invest rather investing huge amount at time and taking risk

you need to have account with cheque book in the city where mutual funds processing centre is available

Answer 6

ystematic Investment Plan (SIP) is a simple, time-honored strategy designed to help investors accumulate wealth in a disciplined manner over the long-term and plan a better future for them. This disciplined approach to investing will provide you with the following benefits:

* Power of Compounding
* Rupee Cost Averaging
* Convenience

Answer 7

Systematic Investment Plan (SIP) is very simple to explain. It means a specified amount of investment on a specified date in a specific scheme.