Is it safe to stay invested in SIPs
In Today’s time various financial products are available in market. Investors can buy any financial product according to their need like Mutual funds, equity, bonds, commodity, currency, etc. These are among the various financial products offered by the stock market. But one word that we hear every day as a basic need for every individual is SIP. SIP (Systematic Investment Plan) is a mutual fund tool which allows you to invest regularly a fixed amount in your favourite mutual fund scheme/s. In SIP, fixed amount I deducted fromthe account every month automaticallyand invested in the mutual fund you choose to invest in.One of the main advantages of SIP is that it helps to build the habit of saving and investing regularly. As we know this process of SIP is goal-oriented and regular, it always keeps you on the right track. You are sure to achieve your goals in the expected time.
As we all know this is the time of crises because of COVID-19 pandemic and market is on the down side. Mutual fund investors who started SIPs in equity funds sometimes ago are not earning very good returns. In many cases, they have earned less than what a savings bank account offers. So the question arises Is it safe to stay invested in SIPs at this point of time? Answer is YES
Whenever this kind of situation arises, we try to postpone our investments or stop investing but concept of SIP helps us to overcome this type of thinking. When we regularly invest in SIP over a long period of time irrespective of market conditions, it definitely gives us profit after certain time because SIP help us to buy more units with same price when market is downturn. This is how SIPs help us to maximise our returns. So if we stop or pause our investment in this bad or volatile phase in market, we are actually missing an opportunity to earn more profit.
So keep investing in SIP and grab the opportunities to earn more profit.