Why Are SIP Investments Rising Even in Equity Market Volatility?
Once again Systematic Investment Plans, popularly known as SIPs, are leading the news highlights. This time it is because of their rising collection and inflows in the first quarter of the financial year 2019 despite heavy volatility.
Association of Mutual Funds in India has clearly stated that in April-June 2018 the industry has collected a whopping amount of Rs. 21,548 crore via SIP investments which is around 58 percent greater than what was collected in the last year during the same period. The regulatory body AMFI have analyzed that the mutual fund industry added 9.83 lakh accounts for SIP investments on an average for Q1 2018. Considering the present time, the domestic mutual funds have around 2.29 crore active SIP accounts through which regular investments are made in Indian MF schemes.
What Could Be the Possible Reason(s) Behind This Upsurge?
Taking statistics into concern, the SIP inflows in the FY 16-17 was 3122, 3189, and 3310 in the month of April, May, and June, respectively. Similarly, in FY 17-18, the records were 4269, 4584, and 4744, resp.
The above number clearly predicts that despite the volatility, the investments, especially in Systematic Investment Plans remain unaffected. Foreign institutional investors’ outflows, depreciation in the price of rupee against the US dollar, and rising crude oil prices are the top reasons behind the rising volatility. However, with time, investor education initiatives by AMFI via campaigns like ‘Mutual Fund Sahi Hai’, industry is adding SIP inflows. Furthermore, investors too have become a little mature and have learned to ignore the market noise.
Due to this, mutual fund officials have developed confidence that SIP inflows will remain steady and this will remain to rise even in the volatile market.
Expert's View On What Should You Do
Well, it’s always a wise thing to seize the best of opportunities at the right time. Thus, you too must start being a part of this investment progress and adopt an unwavering discipline to do away with the market volatility and gain monetary profits as well. SIP is the best and the most convenient method of investing in mutual funds. It aids in rupee-cost averaging and promotes investing in a disciplined manner without worrying about volatility and timing the market. In the present time, one has the flexibility to buy at low prices when the market is volatile and sell at high, thus earn good returns. On the top of it, the minimum amount needed for SIP investment can be as small as Rs 500, which is similar to recurring deposit where you invest small amount every month.
Inspired? Don’t delay your investment decision anymore. Connect with the experts at MySIPonline to get the best recommendations concerning your personalized needs. We will be more than happy to serve you with all our might.
- MySIPonline Awarded the Highest Equity & Debt Net Sales from DSP BlackRock MF9972 min read Aug 16, 2018
- Best Mutual Funds to Choose After the RBI Repo Rate Hike4554 min read Aug 03, 2018
- NFO Launched: ICICI Prudential Bharat Consumption Fund- Series 48233 min read Jul 31, 2018