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Business 147 views May 18, 2018
Benefits To Open SIP Online: Read Them

Sip also known as systematic investment plan has become extremely popular in the market and with the mutual funds investors. It is one of the best ways to invest at given time intervals in the market. It is a tool where the investors get to invest in mutual funds at the time interval of their choice. Most Investment Companies advise investors to invest on equity mutual funds because it helps them get maximum returns along with average purchase cost.

What are the benefits that can be reaped in starting a SIP?

If an individual’s goal is to maximise profits then it is best if they invest in mutual funds. However it is important to understand the different types of mutual funds before you open sip online. If an investor wants maximum returns then they would have to invest in a mutual fund which has a high risk factor for example Small/MidCap where they get to invest in small and medium companies. But if they want lower risks then they would obviously have to invest in LargeCap where they get to invest in large companies but the returns would be much lower as compared to Small/MidCap.

If an individual wants to fulfil his primary financial goal of buying a car and a house in the next 20 years then investing in bonds is not enough because his savings that he will be getting from investing thee bonds will not be enough in fulfilling his financial goals. Two reasons why that will happen is because first, the economy will be in the constant growth of inflation which will eventually result in lowering his savings at the end of tenure of his investment. Second, if he would have invested in equity mutual funds then instead of investing in bonds then he would have gotten higher returns.

More about SIPs

It is true that investing in bonds is definitely playing it safe but that means his returns get lower due to the inflation. The only way to achieve a steady and substantial growth instead of being affected by the market volatility is to invest in a systematic investment plan. It is important to be advised by Investment Companies to know how to open sip online and how SIP works and what benefits can be reaped from it. They study the market trends thoroughly and take into consideration your needs based on which they advise you on the best mutual funds you should invest in.