Timing A ‘SIP' EXIT

Investment is made with the aim of either generating superior returns or achieving your financial goal. Taking into consideration these quantitative and qualitative factors will help you achieve both. The following article provides a guideline about managing your SIP for a fund

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The stock market around the world has been on a roller-coaster ride in recent times. On account of the pandemic that has gripped with globe, investors have been witness to sharp downturns in the months of February and March, which also included indices hitting the lower circuit a few times. However, in the month of April, we saw one of the biggest monthly gains of the decade. In the meantime, one of the worst sufferers of this volatility is the SIP investor who has dutifully and religiously remained invested during all this turmoil.

The SIP returns for equity investors in the last three and five years on an average have been negative, except for a few pockets that have generated positive SIP returns. Even in a 10-year period, SIP returns for most of the categories failed to beat the normal bank fixed deposit returns. Investment is all about generating positive returns, if not in a shorter period then definitely over a longer duration. But if even after five years you are staring at negative returns on your investment, there definitely seems to be a need to re-strategize your wealth creation plan.

The Right Timing