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Avoid Daily SIPs

Daily SIPs in equity funds don’t make sense for long-term investments. Find out why…

Is it wise to invest in equity diversified mutual funds through daily SIPs?
-Madhavan

Systematic Investment Plans (SIP) is a good thing because they enable you to average out your investments in equities. But too much of a good thing may not be good. Daily SIPs would create a lot of headache in terms of making sure they're happening, looking at the accounting part of it, reconciling with your statements, etc. It would be a huge distraction. And statistically, if you're investing for a long period of 5-10 years, daily SIPs won't even make any meaningful difference.



This article was originally published on July 10, 2012.

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