Someone has wisely said that one can not and should not time the market. This is why investing through Systematic Investment Plan (SIP’s) works. Taking the SIP route takes away the risk to the larger extent, especially in long term. However, there is another option which suits to those investors who wish to invest lumpsum money into mutual funds i.e. Systematic Transfer Plan (STP).
What is Systematic Transfer Plan?
By opting Systematic Transfer Plan, an investor is able to invest lump sum amount into mutual fund with the option of transferring the fixed or flexible amount into a different scheme. It can also be termed as the extension route of SIP as like in the case of SIPs you can invest in mutual funds in a small amount that is as low as Rs. 500. In the case of STP, you can typically park a lump sum amount in any Debt mutual fund scheme, from which fixed or variable sum gets transferred into an equity oriented mutual scheme at a periodic interval. It means that the units equivalent to the transferred amount will be sold from primary debt mutual fund schemes and the same amount will be used to buy units of the chosen equity mutual fund scheme. One can use the STP into several schemes at the same time.
This story is from the January 2018 edition of Investors India.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 8,500+ magazines and newspapers.
Already a subscriber ? Sign In
This story is from the January 2018 edition of Investors India.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 8,500+ magazines and newspapers.
Already a subscriber? Sign In
Why Should One Consider Investing In A Large Cap Fund?
An investor’s ability to create wealth in the longterm is directly linked to how well they create an all-weather investment portfolio.
Meeting Medical Costs with Health Insurance Plans
A medical emergency can occur at any time and to any person.
Water: The Elixir of Life
If there is magic on the Planet Earth, it is contained in water - Loran Eiseley.
The 100 Crore Wealth Legacy! A Vision
Generating 100 crores from modest investments is feasible with a long-term outlook, though market timing remains elusive.
Unleashing Potential: The Dynamics of AI in India
After attending the Microsoft AI Tour recently, I attended a few conferences and met with some government officials over the past few weeks during my macro tour.
The Growing Role of Philanthropy in Wealth Management: A Shift Towards Purpose-Driven Strategies
In recent years, India’s economic landscape has seen a notable shift with the rise of High-Net-Worth Individuals (HNWIs), who are reshaping the financial ecosystem.
Are You Drinking Too Much Coffee? If Yes, Then You Are Taking A Big Risk!
Coffee contains caffeine in maximum percentage:
LIC MUTUAL FUND
According to World Bank data, women represent 49.7% of the world population. In India, women represent 48.4% of the population but they contribute only around 18% of the GDP compared to 41% in China.
Maintain 15-20% exposure to US funds in your equity portfolio
2022 was a difficult year for stocks in the United States (US), particularly for the large tech companies known as FANG. Concerns about the Russia-Ukraine conflict, inflation, etc led to a significant drop in their values.
Systematic Investment Plan (Sip): Meaning, Benefits, How It Works
We all dream of buying a car, dream house, gadgets, etc. This all can come to reality if we have strong financial planning. One of the best options is to start investing in mutual funds through a SIP (Systematic Investment Plan).