Introducing AI for customer service
Powerful AI that takes care of your daily tasks. Stop manually processing your text, document, and image data. Let AI work its magic, without a single line of code.
Top Stories
SIP Calculator
-1 Year
Total Investment: ₹
Total Value: ₹
Selected Year
Total Investment: ₹
Total Value: ₹
+1 Year
Total Investment: ₹
Total Value: ₹
SIP Calculator
-1 Year
Total Investment: ₹
Total Value: ₹
Selected Year
Total Investment: ₹
Total Value: ₹
+1 Year
Total Investment: ₹
Total Value: ₹
What is SIP ?
Picture your money going for a regular stroll through the market with a Systematic Investment Plan (SIP). Instead of a quick dash, it’s a steady, intentional approach. SIP involves setting aside a small, predetermined amount regularly, usually monthly, to invest in stocks or Mutual Funds. Think of it as feeding your investment gradually, ensuring steady involvement in the market while effectively managing risk. Essentially, SIP is the savvy choice for those aiming to navigate the market smoothly and confidently.
How do SIPs work ?
SIPs operate on two key principles:
Rupee Cost Averaging: SIPs provide a shield against market volatility by removing the guesswork of market timing. Consistent investing ensures that the average purchase cost levels out over time. When the market rises, you acquire fewer units, and when it falls, you get more units. This minimizes risk and ensures you obtain investments at a lower average cost per unit.
Compounding: Saving a small amount regularly over extended periods can lead to exponential growth in your investment due to the power of compounding. Consider these examples:
‘A’ begins investing at the age of 40 for his 60th birthday. Assuming a 7% return and a monthly investment of Rs. 1000, his total corpus after 20 years would be Rs. 5,28,000.
‘B’ starts investing at the age of 20 for his 60th birthday. Assuming the same parameters, his total corpus after 40 years would be an impressive Rs. 26,56,436—almost five times that of ‘A’.
Regular investments over longer durations yield significant returns and profits, showcasing the power of compounding.
Advantages of investing in SIP
SIPs offer numerous benefits:
Financial Discipline: The regularity of SIPs fosters financial discipline by promoting consistent savings without significantly impacting your lifestyle. It instills a habit of saving and helps in building a substantial corpus over time.
Flexibility: SIPs provide flexibility in investing. You have the freedom to adjust the investment amount according to your financial situation. Whether you want to increase, decrease, or pause your investments, you can do so at any time, offering adaptability to your changing needs.
Convenience: SIPs are incredibly convenient. With a one-time set of instructions, you can initiate your SIP online, and it will automatically accumulate over time. This hassle-free mode of investing saves you time and effort.
Lower Risk: Unlike lump sum investments that can expose you to greater capital risk, SIPs spread your investment over time, reducing the impact of market volatility. By averaging out the purchase cost and spreading investments, SIPs help mitigate risk and enable you to navigate market fluctuations more effectively.