Mutual funds have gained immense popularity among investors due to their flexibility. There has been growing acceptance to invest in mutual funds due to the availability of several fund categories that suit investors across all risk profiles. But when it comes to equity funds, people always tend to wait for the market to become more stable before investing in it. The truth is that the market is volatile and unpredictable. None of us knows what the future has in store for us. Hence there is no point in waiting because markets keep rising and falling, and it’s a never-ending cycle.
So when to invest?
Investments in investment choices based on the current market situation. Short to medium-term volatility and trends should not really matter when you focus on long-term investments, especially through SIPs.funds are advised to attain their long-term economic objectives such as education for children, retirement, etc. Remember that you should not always make your
SIP and its benefits
Mutual funds offer you an investment path called a Systematic Investment Plan, familiarly known as SIP. With SIP, you can invest a set amount at periodic intervals in a Mutual Fund scheme–say once a month or once a quarter, rather than making a bulk investment. You can choose to invest an amount as low as Rs. 500 each month. This is an easy process as you can instruct your bank to debit the set amount each month for a defined period of time.
Using this mode of investment saving habits thanks to its investment nature. In fact, it also scores over making similar investments on your own each month. If you have chosen a mutual fund scheme and plan to invest a certain amount of cash each month, apart from the fact that you have to manage time to do that, you may also have worries about market circumstances and might as well ponder upon delaying your investments. With SIP, you have the convenience of not worrying about these concerns. At frequent intervals, the in a scheme without you making any direct effort.with immense benefits. SIP contributes to financial discipline and instills periodic
Tinyin a mutual fund done in periodic intervals can help you build a strong portfolio for your financial goals. This path can be chosen by anyone who is a beginner in investments and wants to play it safe. Here are some of the benefits of opting for SIP:
The benefit of averaging the cost of your money
Once you decide to invest in a mutual fund through SIP, you will notice that when the investment price goes down, it increases the purchase of the mutual fund units. For instance, if your SIP of Rs 500 was getting you 10 units when the market was at its peak, you will get more than 10 units when the market comes down. This would mean getting more for a lesser cost. In other words, this reduces the average price over time of purchasing economic assets.
Waiting and wondering when the right time to invest in the market may not be of much use. And that’s simply because it is nearly impossible to predict when the market will reach its peak or hit a low point. Investing through SIP keeps you from timing the market. It is also true that even investments made through SIPs won’t remain unaffected by the market volatility. However, that is your best shot at making good financial gains with minimum investment over a period of time.
Disclaimer: Mutual Fund investments are subject to market risk. Please the offer document carefully before investing.