How to become an expert mutual fund investor: Don't forget the reverse gear

Over the years, a large part of the investment narrative in the mutual fund industry has focused on systematic investment plans (SIPs). And that's only natural, given the built-in growth in the Indian markets and a large population waiting to benefit from the wealth-creating potential of equities. However, market crashes like 2008 or March 2020 have highlighted that while it's important to invest regularly, you should also have an exit plan in order to protect your corpus from any abrupt market fall just when you need it. The systematic withdrawal plan, or SWP, is the other side of the investment equation. It is the reverse of an SIP and helps you systematically exit equities. The process involved is simple - when you set up an SWP, a part of your accumulated corpus is tr

This article was originally published on December 23, 2021.