Five Myths and Facts of Systematic Investment Plan


MYTH#1: SIP is best for short term & not the long term.

FACT: Long term investment through SIP can help offset the highs and lows, so that you may expect reasonable returns at the end.

MYTH#2: You can do better than SIP by timing the market accurately.

FACT: It is almost impossible to time the market correctly all the time. It’s not about timing the market, but the amount of time you stay in the market.

MYTH#3: SIP works best in rising market.

FACT: SIP works best in long term irrespective of market conditions.

MYTH#4 SIP is for small retail investors.

FACT: SIP might be the answer for all types of investors since it does not have a bias towards high or low value investments. All that it requires is regular and disciplined savings.

MYTH#5:Once an SIP is started, it can not be stopped before a specific period.

FACT: You can easily discontinue the SIP by giving 30 days prior notice to the fund house or registrar of the fund house.

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