If you persist with the SIP, this phase is likely to set you up for a healthy outcome later. If this persists for the first 2-3 years and you don’t see any return from the SIP, what are you likely to do? Won’t you be tempted to throw in the towel? Given the volatility in equities, there will be times when the market will trend lower or sideways. How the market behaves in this phase is not so critical for the investing outcome, but how you behave in response to the market’s vagaries will make all the difference. The early years of a SIP can be a real test for your investing discipline. Here, we outline certain critical attributes of a typical SIP throughout its life to help you better understand and navigate the path you are on. If you set your expectations right, it will help maintain your investing resolve and allow SIPs the time they need to yield the desired outcome. The path to success with SIPs is not linear. As the SIP culture is embraced by investors, it is crucial that they know what to expect when they take this journey. While it is common knowledge that long-term investment in mutual funds through SIPs helps navigate the market ups and downs, there are other facets of SIPs that are still not fully realised or appreciated. Clearly, investors are now sold on the benefits of SIP discipline. The monthly SIP inflows crossed Rs.14,000 crore for the second consecutive month. As per the data from the Association of Mutual Funds in India, new SIP registrations for the month of June hit a record high of 27.8 lakh, taking the total SIP accounts to 6.7 crore. Retail investors with small ticket sizes continue to plough big money into mutual funds in auto-pilot mode. The humble SIP (systematic investment plan) is turning into a behemoth.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |