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Understanding SIPs

An SIP is a mandate that a fixed amount will be deducted from your bank account periodically & invested in a fund…

Is it necessary to invest in mutual funds via SIPs or can I invest a particular amount every month?
-Jaskaran

Both ways of investing are similar. If you can invest every month in a disciplined manner, then it would be just like an SIP. An SIP is systematic investment plan, wherein you mandate that a particular amount will be deducted from your bank account every month and will get invested in the fund. If you can do the same thing every month by yourself, the effect would be the same.



This article was originally published on May 30, 2012.

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