Systematic investment plans (SIPs) have become the preferred way of investing in mutual funds (MFs). The advantages of SIPs are manifold: low initial investment, convenience, disciplined investing, and cost averaging. For one, it is a static method of investing—the investment amount remains fixed irrespective of your income and market levels. Systematic transfer plans (STP) or Systematic withdrawal plans (SWP) can also be used to rebalance the portfolio. The reverse is also true, i.e., a poorly performing fund will raise eyebrows, even though the overall portfolio performance is good.

Source: Mint September 04, 2016 18:11 UTC