Systematic Investment Plan (SIP) is a kind of investment scheme offered by mutual fund companies. Using SIP one can invest small amount periodically (weekly, monthly, quarterly) into a selected mutual fund scheme. For retail investors, SIP offers a well disciplined and passive approach to investing, to create wealth in long term (using the power of compounding). Since, the amount is invested on regular intervals (usually on monthly basis), it also reduces the impact of market volatility.

As common investor doesn’t have enough time and resources, SIP proves to be a viable option for them. Listed below are the important benefits of this instrument.

>Reduces Risk because of Rupee Cost Averaging

>SIP can be started with very small amount of money, as low as Rs 100

>Timing the market is not necessary

>Long term financial goal can be aligned with SIP

>Disciplined approach towards Investment helps in controlling the emotions