Sip (systematic Investment Plan).

Discussion in Savings & Investments Plans started by luckycharm • Feb 9, 2017.

  1. luckycharm

    luckycharmActive Member

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    I came to know of SIP or Systematic Investment Plan when I started investing in stock markets. As you know stock market nowadays seems to be highly volatile and you need nerves of steel to remain invested in shares. This is where the importance of SIP comes in. Instead of investing a whole lot of money in shares you can invest a fixed sum every month through mutual funds. So even though the market is volatile you stand to gain during a long period of time.

    Have you ever opted for a SIP and how did it go?
     
  2. Nakitakona

    NakitakonaActive Member

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    I have not heard about this SIP and I hadn't even dared to invest in the stock exchange for I didn't its process. I don't know if this is similar to SIP that I used to joined while I was still working in the government. We had this so-called an employee cooperative. Every month we give our share of a certain amount of money and at the end of the year, we get our share or the dividend from the money we had invested. Though, the share we get is not big compared to real estate investment, stock exchange, among others. But our money invested earned a profit.
     
  3. ptahm22

    ptahm22Active Member

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    I recently opted for SIP and am loving it mainly because, It's a stress-free way of investing: Investor doesn't have to worry about timing the market. Its stress-free. Once the mechanism is set-up, fixed amount will be deducted from your account.
    Also short-term fluctuation doesn't harm as much : If the price goes down by 10 % in the next month. You have a consolation that you are also buying at reduced price too. and if the market recovers to previous level, you actually make money overall. It doesn't generate alot of returns but it's still a good form of investment.
     
  4. anupamas2

    anupamas2Active Member

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    It has been nine months since I invested in SIP. So far I have not gained much. Because of the demonetizing phase in our country, the NAV value fell down and have not slowly started going up. However, I was told that it was not a bad thing since for two months with the same amount invested, the NAVs bought was more and when the NAV value return to normal or gets high then I will be getting a high return.
    I came to know about SIP through my sister who has invested in this and got very good returns.
     
  5. luckycharm

    luckycharmActive Member

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    I think there is nothing to worry if the company you invested in has strong fundamentals in place. If it's done through a mutual fund it is safer as they are expert in this field. It's in fact a long term play and every fall in the market is an opportunity as you can buy more number of shares. In future when the share price increases you will get higher returns. I think SIP is the ideal form of investment in a volatile market.

    As indicated by @ptahm22@ptahm22 it is the stress-free way of investing in share market. With every fall in the price of share you can see your average cost per share decreasing and a better chance for more profit.
     
  6. Ke Gordon

    Ke GordonWell-Known Member

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    I never heard of this actually. However, Bitcoin seems to be an easy way to earn money. I like that idea in terms of using faucets and so forth. Doing it consistenly over time could be a way to make sure that you have money coming in on a consistent basis.
     
  7. Jamille

    JamilleActive Member

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    @luckycharm@luckycharm Investing your money through mutual funds also subjects your money to the volatility of the stock market because that is where the funds go. The only difference is that your funds are being handled supposedly by experts in the stock market and that your funds are pooled with other investors to allow you to buy shares that will otherwise be beyond your investing capacity. There is never an assurance of gain even if you keep your money invested for a long period of time but there is a certainty that you have to pay some fees to the fund managers.

    It is a sad day when the price per share is decreasing because it means that your investment had also decreased in value. For example, your funds were invested in 100 shares of x company at 5$ for a total of $500. The following week, the market was down and the price per share went down to $4. That means your investment now has a value of only $400. You actually lost, see? But the fund managers and financial gurus will tell you: there's no reason to worry, you're in it for the long haul, so the ups and downs of the stock market should not affect you. In fact, it is the best time to invest more because you stand to gain if the stock market got better.

    But what if the stock market got better but the shares you bought didn't? You can actually end up with nothing in your stock investment portfolio. But then again, that is a risk that you can decide to take or not. I've known people who made money from investments made through mutual funds but I also have friends who lost money in it and those whose investments were just stable.
     
    #7May 24, 2017
    Last edited by a moderator: May 26, 2017