__1. Disciplined Investing approach: Some of you may opt for stock options by timing the market to accrue wealth.
However, timing the market calls for market knowledge, research, technical analysis and a lot of time from your end.
Further, it could also be risky. But through disciplined, regular investments you can stop worrying about when and how much to invest.
In a way, it eliminates the need to actively tracking the market. And SIP helps you to achieve just that.
_2. Takes advantage of Rupee Cost Averaging: Rupee Cost Averaging is an effective investment strategy that eliminates the need to time the market.
All one has to do is to invest a fixed pre-decided amount of money on a regular basis for a long period of time. Since the amount invested is constant
one buys more units when the price is low and fewer units when the price is high which may mean a lower average cost.
3. Simple, convenient and easy to monitor: You do not have to take time from your schedule to make your investments. With a completed application form, one can just
submit post dated cheques or avail the Magnum Easy Pay (auto debit) facility and relax. You can monitor your progress of investment through the periodic statement of accounts.
4. Benefits of Compounding: The key to building wealth is to start investing early and to keep investing regularly. A small amount of money invested regularly can grow to a large sum.
This helps in creating a substantial amount of wealth which includes your own contribution, plus returns compounded over the years. For example, the following graph demonstrates the
effect of returns on monthly investments of 1000 per month for a period of 30 years.
5. Power of starting early: Helps create wealth: The earlier one starts regular savings, the easier
it is for wealth creation. The graph below shows the impact of starting at various stages in life. 1000 was invested on a monthly basis till the retirement age of 60 years. The rate of
return on investment was assumed at 10 percent p.a. It can be seen that even a five year delay can make a significant reduction in the overall creation of wealth.
.jpg)
Industry News