Benefits Of Investing Through SIP

Benefits Of Investing Through SIP

A SIP is also known as the systematic investment plan of getting rewarded in the future with a small investment and getting built up wealth in the future. They deliver superb returns as compare with the other bank profile schemes.

Though, SIP is a long term investment with low risk as compared with the share market. This scheme allows the investor to invest a requested amount for a particular time. You have to adopt the desired designed SIP as it suits you. Three types of SIP designs as follows:

Assets: Allocation of assets means the money you should invest in a particular section or category of any mutual fund every month. There are both small-cap investment and large-cap, where you can choose the time according to your will and promised amount.

Total Schemes: If you are a new investor and want some handsome amount in future then you must have around three schemes in your portfolio, where you can easily track your favorite schemes and they are easy to manage.

If you add above 6 – 7 it would be difficult for you to manage and seek every possible aspect. It must contain 4 equity schemes and 1 debt scheme in your folio.

Mutual fund: Mutual fund becomes the last step where the investor needs to design a smart folio. You have to search the desired mutual fund you want to invest in then take a look over the past performance of the mutual funds that you picked and arrange them according to their performance-wise.

From the list pick one or two funds and start investing in them sure you will grow your money like never before.

Benefits of SIP

  1. Less prone to risk: Mutual funds are interlinked with the debt and the equities thus carry more risk but under the SIP module risk reduces due to the periodically unit investments.
  2. Small investments: SIP is the only investment where the investor can invest the lowest amount of Rs. 500. This covers every class of the society and reduces the chance of risk and burden of lump investment.
  3. Compounding: SIP helps you to invest periodically and increase regularly. It increases your amount under fixed amount and time thus benefits in compounding this lead to you to earn returns from your investment returns generated by the investment of yours.
  4. Auto deduction process: The SIP allows the investor to auto debt feature that allows automated deduction of money from the bank account of yours without visiting or filling or deposition of amount for particular investment every month.


Here is the list of top sip plans to invest in 2019-20

  • ICICI Prudential blue-chip fund
  • Franklin India equity
  • ICICI prudential value discovery fund
  • DSP equity opportunities
  • MotilalOswal long term equity fund
  • Axis long term equity
  • DSP tax saver
  • DSP Equity opportunities
  • HDFC equity
  • Aditya Birla sun life pure value

These were the top 10 best SIP plans that were sorted based on last 3-year performance.