All About SIP
What is an SIP?
Systematic Investment Plan (SIP) is a hassle-free method of investment that helps you achieve your financial goals by investing small sums of money on a periodic basis. It allows you to smartly invest in a Mutual Fund by making smaller periodic investments (monthly or quarterly) in place of a heavy one-time investment. It is a great alternative to long term commitments like PPF or Insurance plans. Starting early and investing regularly is advisable to minimize the investment amount needed to achieve your goals.
How SIP works?
With UTI SIP, your amount to be invested will be periodically auto-debited from your bank account and will be invested into a specific mutual fund scheme. You will be allocated a particular number of units accordingly, based on the current market rate (net asset value or NAV in short) for the day.
You also have the option to choose from direct and regular plans. Direct plans are bought directly from the mutual fund company, whereas a Regular plan is bought through an intermediary (advisor, broker or distributor)
You can calculate the expected returns on your investment using our easy SIP calculator.
Please read the terms and conditions carefully before investing. Do keep in mind that minimum amounts may differ for each SIP Scheme. Please refer to the SIP Enrolment Form for details.
Systematic Investment Plan (SIP) is a hassle-free method of investment that helps you achieve your financial goals by investing small sums of money on a periodic basis. It allows you to smartly invest in a Mutual Fund by making smaller periodic investments (monthly or quarterly) in place of a heavy one-time investment.
Benefits of SIP:
Disciplined approach to InvestingRead More
Rupee Cost AveragingRead More
Convenient, flexible and cost-effectiveRead More
Power of CompoundingRead More
Things to keep in mind before starting an SIP
Even though SIPs are flexible, it doesn’t mean that the investment horizon can be shortened. It all depends upon your investment goals and the type of funds in the SIP portfolio. SIPs with longer investment horizons generally have better wealth accumulation.
Before investing in SIP, it is very important to understand your risk appetite. It will be determined based on various factors - age, liquidity needs, nature of employment, investment horizon and investment goals. Knowing your risk appetite will help you choose the right SIP to match your goals.
In SIP, each installment is taken as a new investment and, hence, you will be charged an exit load on the NAV, if you withdraw your investment within the predefined time.
Like all Mutual Funds, SIP is also subject to market risks. However, it is also one of the best vehicles to counter market volatility due to rupee cost averaging and long investment horizons. It is highly advisable to read the offer document carefully before investing.