VR Logo


Initiating an STP from a debt fund to create SIP investments in an equity fund is a good move…

I have recently invested Rs 50,000 in a debt fund from Franklin Templeton and initiated an STP in Franklin India Bluechip for Rs 2,000 every month for two years. Is it advisable to run an STP for two years or should I have opted the STP for one year for Rs 4,000?
- Kiran Sarikonda

First, your choice of Franklin India Bluechip and your strategy of initiating an STP to create a SIP investment in this fund is having started are both commendable. Investing through SIPs is a disciplined approach to regular investing. You should base the amount that you can invest in a SIP investment or the frequency of your SIP contributions on your convenience and cash flows. Averaging over long periods evens out returns making it a better proposition; however that alone should not be the basis on which you should have investments. You need to ask yourself what you need this investment for after one or two years, which is the time frame that you are looking at.

Post Your Query