SIP or a Systematic Investment Plan, is a great method of investment as it lets you invest a fixed sum in any mutual fund scheme periodically. Once you set up an SIP, a fixed amount of money is automatically deducted from your savings account every month and invested towards the mutual fund you have chosen to invest in.
The great thing about an SIP is that you can start small – even as low as ₹1000! You do not need to make a large one-time investment, which involves the risk of timing the market. Thus, SIPs are also suitable for those who are just starting to invest their money. It starts small and helps you develop a discipline of saving early and regularly - a small but great way to start your journey of wealth creation.
In other words, SIP is a popular investment strategy where, you put a certain amount of money each month away. You get to decide the monthly investment amount and the time span of this investment. With Citibank, you can invest as little as ₹1,000* a month in a SIP.
Here are the top reasons to invest in a Systematic Investment Plan with Citi India -
- It helps you develop a disciplined approach to savings
- No transaction fee for SIPs
- You can choose how much and for how long to save
- You can start as low as ₹1,000 per month
- Set up an SIP online using Citi Mobile App/Citibank Online
Track your SIPs and portfolio 24x7 with Citi Mobile App
An SIP helps avoid some common investor mistakes like unrealistic optimism, underestimating one's time horizon, misaligning investment objectives and portfolio strategy, over-enthusiastic trading or trying to time the market.
The benefits of an SIP
Tackles Volatility
Volatility indicates sharp movements in market indices and is characterized by periods when prices move quickly and/or by large amounts between gains or losses. It can be often be viewed as negative i.e. it represents risk. SIP reduces the average purchase cost even in volatile stock markets with relative ease. When you invest a fixed amount every month, the number of Mutual Fund units you actually buy depends on their market price. Therefore, with the money you invest each month, you can buy fewer units when the market moves up and more units when the market moves down. This brings down and averages the price of purchase. Over time, your chances of making a profit are much higher when compared to a one-time investment.
The Power of Compounding
Power of compounding works on the principle of building wealth through reinvesting rather than spending the profits. It all adds up. When you choose the power of compounding, you choose a way to accumulate wealth better.
The Power of Rupee Cost Averaging
In a volatile market, regular small investments help get you a better cost per unit than large, one-time investments. When you invest small amounts at regular intervals, you have the opportunity to pick up more units when the prices are low. And when the prices go up, you can buy fewer units. This brings the average cost of your units down. Therefore there is no need to time the markets as you invest at predetermined intervals. Once you have chosen the fund to invest in, you need to aim for a better average cost.
Small or big, the right time to start investing is always right now. And if you are looking to create wealth, it is good to start somewhere, even if it is small. And an SIP is a great way to start off on this wealth journey.
To start an SIP via Citibank, log into Citibank Online or your Citi Mobile App today and explore the ‘Easy Investing’ option! You can also meet a Citibank Investment Counsellor at your nearest Citibank branch.
