1. SYSTEMATIC INVESTMENT PLAN (SIP)
AN INITIATIVE BY A.K. JAIN & CO.

2. WHAT IS A SYSTEMATIC INVESTMENT PLAN
Systematic Investment Plan (SIP) is an investment vehicle offered by mutual funds to investors, allowing them to invest using small periodically amounts instead of lump sums. The frequency of investment is usually weekly, monthly or quarterly.
 Investing in SIP enables an investor to take part in the stock markets without actively timing them and he/she can benefit by buying more units when the price falls and less units when the price rises. This scheme helps reduce the average cost per unit of investment through a method called Rupee Cost Averaging.

3. For Example: A person invests Rs 1000 for ten months in SIP
For Example: A person invests Rs 1000 for ten months in SIP. We will find out that the actual average purchase cost of asset would be lower than the average NAV of his investment over 10 months, which is the key benefit of Rupee Cost Averaging.
Actual average purchase cost as per SIP = (1000X10)/ ( ) = 14.06

4. UNDERSTANDING SYSTEMATIC INVESTMENT PLAN
Systematic investment plan as the name suggest allows a user to build an investment portfolio with a small systematic investment at regular intervals. The investor can choose his or her preferred mode of investment as monthly, quarterly or annually and invest the funds according to his or her convenience. Users of systematic investment plans can choose from various investment vehicles to invest their money including stocks, mutual funds, ETFs and even gold funds.

5. UNDERSTANDING SIP USING A SHORT STORY

6. ADVANTAGES OF INVESTING IN SIP
Investment discipline: The one basic rules of investing is to always maintain a focused and dedicated approach towards investment.  A large number of people enter the investment markets with a lot of enthusiasm but fail to maintain a monthly investment towards building a regular investment corpus. Investing in a systematic investment plan allows users to maintain a monthly investment scheme which is far easier to maintain in the long run rather than investing a lump sum amount each year. Investing in systematic investment plans must be considered by all investors who are yet to attain an investment discipline allowing them the convenience to invest a pre determined short sum every month towards their future. 

7. RUPEE COST AVERAGING
Rupee cost averaging, also commonly known as RCA is one of the very significant reasons why investing in a systematic investment plan must be considered by almost every investor. Investors investing a fixed amount of money every month towards any investment vehicle allow them to purchase more units or stocks when the price of the investment is lower. This reduces the average cost of purchasing of the financial asset over time. Considering a long term investment approach, rupee cost averaging can even out any market ups and downs in the long term, allowing the investor to gain maximum benefits ion his or her investments over time. 

8. In simplistic terms, let us consider an investor is investing a monthly fixed amount in a mutual fund investment plan. Considering the fact that the investor invests the same amount each month irrespective of the market cycle, be it a bull phase or a bear phase, the average cost of investment is eventually maintained at a lower level allowing maximum gains in the long term. 

9. POWER OF COMPOUNDING
One of the basic rules of being a successful investor is to start early. Since all investment and returns are based on the power of compounding, an investor starting out early can earn much higher returns than a one starting out late even with a slightly higher corpus. Since  a systematic investment plan do not seek a large amount of investment and users can start investing with a low sum each month depending on their financial condition, it allows them to start investing much early in life. 

10. Let us consider Mr. A and Mr
Let us consider Mr. A and Mr. B and understand how the power of compounding helps the investor using a systematic approach.
Mr. A started investing in a systematic investment plan investing a sum of Rs when he was 30 years old. By the time Mr. A reaches 50 years of age, he would have invested Rs. 24 Lakhs if the money grew on an average rate of 7% per annum.
Now let us consider Mr. B who starts out earlier than Mr. A and started investing the same amount of Rs from the time he was 20 years old or ten years earlier than Mr. A. Mr. B's investment growing at the same rate of 7% per annum would end up as high as Rs. 36 Lakhs by the time he is 50 years old.
So while both Mr. A and Mr. B invested same amount each month, the one starting out early has made a substantial gain compared to the one starting out late. 

11. INVESTMENT CONVINIENCE
A systematic investment plan as the name suggests is systematic in nature allowing the investor the advantage of investing small amount of money each month without any hassles. The investor can send a onetime instruction to his or her bank to allow auto debit of the investment amount each month from his or her savings bank account allowing systematic investments without worrying about missing out on any monthly investment.  “ DO NOT SAVE WHAT IS LEFT AFTER SPENDING, BUT SPEND WHAT IS LEFT AFTER SAVING”
BY – WARREN BUFFETT

12. OTHER BENEFITS
A systematic investment plan offers a number of miscellaneous benefits that make investment quite comfortable and an enjoyable experience.
One can start investing in a systematic investment plan with a very low amount of Rs. 500 or Rs per month. This allows users of all financial backgrounds to invest in capital markets without feeling the pinch of a lump sum investment.
A large number of fund houses waive off entry or exit load on mutual funds in case the investment is done through a systematic investment plan. SIPs also offer a taxation benefit as SIPs are taxed for capital gains on first in first out basis. 

13. PLEASE FEEL FREE TO CONATCT FOR ANY FINANCIAL QUERY
CONTACT – MR. A.K. JAIN
PHONE -
WEBSITE -

14. THANK YOU