Skip to main content

Myths Arpound Systematic Investment Plans or SIPs

Invest In Tax Saving Mutual Funds Online

Call 0 94 8300 8300 (India)

Mutual Fund SIPs

 

Here I would like to start this article by defining “What Is A Myth”. A myth is a story which may or may not be true. It is generally old and its conclusions might have been lost in time. However in general a myth is a story whose conclusion is taken for granted without checking it. Many a time the wrong conclusions are drawn. “He Who Must Catch Fish Must Not Mind Getting Wet” This basically means that in order to succeed in our systematic investment plans we need to demystify the myths. Only then can we make an informed decision in order to invest in a Systematic Investment Plan

 

I Can Do It Alone I Don’t Need Any Help:

Here many people try to do an SIP in a single stock; An SIP is done in an Equity Diversified Mutual Fund which is a portfolio or basically a collection of a number of stocks in different sectors. We cannot do an SIP in a single stock. But I will stick only to Blue Chip Stocks? However good a stock is it is too risky to put all your eggs in one basket. Many companies perform well for about 3 years and some of them become a part of the major Index like the BSE Sensex. A certain major Infrastructure company was once part of the BSE Sensex but now it no longer is part of the Sensex. If we look at the power sector we find all the major power Companies languishing in the doldrums. This is mainly because of lack of coal supply .Imagine if we had taken a bet in a single major Power company or for that matter a major Telecom Company which is shaken up due to the 2G scam. What would be our state? Everyone is wise after a bitter experience but a wise man learns from other’s mistakes.

SIP Is Only For Small Investors And Salaried Guys:

Here SIP is a concept or a technique and does not depend on the sums of money invested. Here many people believe that an SIP is only for small investors who want to save for a rainy day. Do you think this is true? Here an SIP does not depend on the sums invested. An HNI might invest INR 500000 per month in an SIP and a salaried man say INR 5000 per month. Here we see that both of them are making use of the SIP albeit for different amounts. Here a man becomes rich not by doing things differently but by following the basic rules and doing the right things. Remember the piggy bank we all had in our school days. This is basically an SIP without a rate of return.

Isn’t SIP A Fund Or A Scheme:

Here you might have heard many people ask “What Is the NAV of my SIP? Here people forget that SIP is a tool or a technique to invest in the stock market. It is not a mutual fund and does not have an NAV value. Here this is a technique to invest in a particularly good mutual fund.

SIP Should Always Be Done Timing The Market:

Here people state that we should start an SIP when the markets are low and exit when the markets are high. How does one come to know when the markets are high and when the markets are low? Who could predict the highs of the stock market in 2007 or for that matter the stock market crash of 2008 due to the USA Subprime lending crisis. The very basis of an SIP is to stay invested in the market irrespective of the ride. Here the ride could be smooth, choppy or outright Stormy. “Remember Caution Is The Parent Of Safety”.

SIP Is The Cure For All Diseases:

Here many people believe that SIP is a magic wand that can skyrocket the returns on our investments .Don’t these SIP’s give us great returns over a 5 year term period? .Here one needs to be wise and prudent while demanding returns from these funds. No one can predict market crashes and if we had started our SIP in the Year 2007, what would be the value of our SIP’s in December 2008. Here in an SIP we have to plan the mutual fund scheme, time horizon and the period of investment. Here we obtain lesser units of a mutual fund when the market is rising due to rise in NAV and higher number of units in a falling market due to a lesser value of an NAV. Unfortunately most of the people close up the SIP in a falling market taking up great losses.

Happy Investing!!

We can help. Call 0 94 8300 8300 (India)

Leave your comment with mail ID and we will answer them

OR

You can write back to us at PrajnaCapital [at] Gmail [dot] Com

---------------------------------------------

Invest in Tax Saving Mutual Funds ( ELSS Mutual Funds ) to upto Rs 1 lakh and Save tax under Section 80C.

Invest Tax Saving Mutual Funds Online

Tax Saving Mutual Funds Online

These links can be used to Purchase Mutual Funds Online that are regular also (Investment, non-tax saving)

Download Tax Saving Mutual Fund Application Forms from all AMCs

Download Tax Saving Mutual Fund Applications

These Application Forms can be used for buying regular mutual funds also

Some of the best Tax Saving Mutual Funds available ( ELSS Mutual Funds )

  1. ICICI Prudential Tax Plan Invest Online
  2. HDFC TaxSaver Invest Online
  3. DSP BlackRock Tax Saver Fund Invest Online
  4. Reliance Tax Saver (ELSS) Fund Invest Online
  5. Birla Sun Life Tax Relief ‘96 Invest Online
  6. IDFC Tax Advantage (ELSS) Fund Invest Online
  7. SBI Magnum Tax Gain Scheme 1993 Invest Online
  8. Sundaram Tax Saver Invest Online
  9. Edelweiss ELSS Invest Online

------------------

Best Performing Mutual Funds

    1. Largecap Funds Invest Online
      1. DSP BlackRock Top 100 Fund
      2. ICICI Prudential Focused Blue Chip Fund
      3. Birla Sun Life Front Line Equity Fund
    2. Large and Midcap Funds Invest Online
      1. ICICI Prudential Dynamic Plan
      2. HDFC Top 200 Fund
      3. UTI Dividend Yield Fund
    1. Mid and SmallCap Funds Invest Online
      1. Reliance Equity Opportunities Fund
      2. DSP BlackRock Small & Midcap Fund
      3. Sundaram Select Midcap
      4. IDFC Premier Equity Fund
    1. Small and MicroCap Funds Invest Online
      1. DSP BlackRock MicroCap Fund
    1. Sector Funds Invest Online
      1. Reliance Banking Fund
      2. Reliance Banking Fund
    1. Tax Saver MutualFunds Invest Online
      1. ICICI Prudential Tax Plan
      2. HDFC Taxsaver
      3. DSP BlackRock Tax Saver Fund
      4. Reliance Tax Saver (ELSS) Fund
    2. Gold Mutual Funds Invest Online
      1. Relaince Gold Savings Fund
      2. ICICI Prudential Regular Gold Savings Fund
      3. HDFC Gold Fund

Popular posts from this blog

Mutual Fund Review: Religare Tax Plan

Tax Plan is one of the better performing schemes from Religare Asset Management. Existing investors can redeem their investment after three years. But given the scheme's performance, they can continue to stay invested   Given the mandated lock-in period of three years, tax saving schemes give the fund manager the leeway to invest in ideas that may take time to nurture. Religare Tax Plan's investment ideas revolve around 'High Growth', which the fund manager has aimed to achieve by digging out promising stories/businesses in the mid-cap segment. Within the space, consumer staples has been the centre of attention for the last couple of years and can be seen as one of the key reasons for the scheme's outperformance as compared to the broader market. It has, however, tweaked its focus and reduced exposure in midcaps as they were commanding a high premium. The strategy seems to have worked as it returned a 22% gain last year. Religare Tax Plan has outperformed BSE 100...
Read more

JP Morgan launches Emerging Markets Opportunities Equity Offshore Fund

Download Tax Saving Mutual Fund Application Forms Invest In Tax Saving Mutual Funds Online Buy Gold Mutual Funds Leave a missed Call on 94 8300 8300 JP Morgan launches Emerging Markets Opportunities Equity Offshore Fund    The new fund offer opens for subscription on 16 th June and closes on 30 th June. JP Morgan Mutual Fund today announced the launch of its open end fund of fund called Emerging Markets Opportunities Equity Offshore Fund. The fund will invest in an aggressively managed portfolio of emerging market companies in the underlying fund - JPMorgan Funds - Emerging Markets Opportunities Fund, says a JP Morgan press release. Noriko Kuroki, Client Portfolio Manager, Global Emerging Markets Team (Singapore), JPMAM said, "Emerging markets have been out of favour for several years, as growth decelerated and earnings struggled. However, in a world of globalisation, we believe that EM will eventually re-couple with DM, leading to the long-aw...
Read more

Nifty F&O

  1. What is a straddle? A strategy using Nifty options usually before a major event or when one is uncertain of market direction. Comprises purchase of a Nifty call and put option of the same strike price. Usually strikes are purchased closer to the level of the underlying index. 2. What is better ­ buying or selling a straddle? It depends.Implied volatili ty of options, or near-term expectations of price swings in an un derlier like Nifty , usually peaks before an event and falls when the outcome plays out ­ like Infy re sults in past years. However, once the event plays out, a sharp rise or fall in Nifty could result in price of the straddle rising ­ benefiting buy ers. But, normally , those who sell or write options charge hefty premiums from buyers in the hope that fall in volatility would ensure the options end out-of-the-money, hurting buyers. 3. So, do straddle sellers end up winning most of the time? Yes. That's invariably the case when market volatility is trending on the...
Read more

UTI Equity Fund Invest Online

Invest In Tax Saving Mutual Funds Online Download Tax Saving Mutual Fund Application Forms Buy Gold Mutual Funds Call 0 94 8300 8300 (India)   UTI Equity Fund   Invest Online UTI Equity is a large cap-oriented fund with assets under management worth Rs. 2,269 crore (as on June 30, 2013). The fund was originally launched in May 1992 as UTI Mastergain and is benchmarked against S&P BSE 100. A couple of years back the name of the fund was changed to UTI Equity Fund and many of the smaller funds of UTI were merged into this fund. Performance The fund has outperformed its benchmark as well as the equity diversified category average in the last one-, three- and five-year periods. It has repeated the same in 2013 (as on May 31). Since its inception the fund has delivered an impressive 26 per cent compounded annual growth rate which is superior to its benchmark performance in the same period. Y...
Read more

Good time to invest in Infrastructure Funds

Download Tax Saving Mutual Fund Application Forms Invest In Tax Saving Mutual Funds Online Buy Gold Mutual Funds Leave a missed Call on 94 8300 8300   Good time to invest in infrastructure The Sensex has gained almost 10 per cent from May 15 till date, while the CNX Infrastructure Index has gained almost 17 per cent in the period. The price to earnings ( P/ E) ratio of the BSE Sensex is 18.96; for the CNX Infrastructure Index, it is 24.57. The estimated P/ E for next year is 14.04 for the Sensex. Of the 24 companies that make up the CNX Infrastructure Index, six have a P/ E higher than 20. Does this mean infrastructure is fairly valued? Or, has it run up quite a bit? According to experts, barring stray companies, the infra sector is fairly valued and it is a good time to invest. Even if some companies are facing debt restructuring problems, once interest rates come down and regulatory norms become flexible, they will start giving good re...
Read more
Related Posts Plugin for WordPress, Blogger...
Invest in Tax Saving Mutual Funds Download Any Applications
Transact Mutual Funds Online Invest Online
Buy Gold Mutual Funds Invest Now