Monday, October 18, 2021

Benifits of Equity SIP for Retail Investors

 


We’ve known and have read plenty on mutual fund systematic investment plans (SIPs). Now, you can also start SIPs by directly buying equity shares. The present market volatility is an opportunity for investors to make some long-term gains. Some brokerages offer stock SIPs for regular investments in shares.

A stock SIP is just a way to invest systematically. Instead of buying units of mutual fund schemes, you invest in shares. Once you decide how much money you’d like to invest, your brokerage firm places a ‘buy’ order for a predetermined number of shares worth your monthly commitment. Brokerage houses offer daily, weekly and monthly SIPs.

This strategy, also known as rupee cost averaging, will help you average your cost of purchase and make the best of a volatile market. You can benefit from any future falls and also have a better margin of safety.

A stock SIP is a superior way to invest systematically. It enables investors to buy stocks (amount/quantity based), periodically (weekly, monthly, etc.) in a systematic manner. It is the ideal method of investing for long term investors. It helps you make the best of the unpredictable market by adopting a disciplined investment strategy.

Its always better to choose top companies from NIFTY 50 for investing in Stock SIP. The list of NIFTY 50 stocks is presented below.



 Power Of Compounding:

SIP is a disciplined way of investing and ensures you constantly strive to make your investments grow. The automation makes sure your investment grows as opposed to lumpsum where you may forget to invest some time. The small amount you invest daily grows up to a large corpus due as a sum of your contribution and the returns compounded over the years.




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