Is SIP Safe?
SIP is a safe and easy way to invest in mutual funds. With SIP, you can invest
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SIP Plan Benefits
Start SIP with as low as ₹1000
No hidden charges
Save upto ₹46,800 in Taxunder section 80C^
Zero LTCG Tax¶
Disciplined & worry-free investing
What is SIP?
A SIP is a disciplined way of investing in mutual funds where investors contribute a fixed sum of money at regular intervals (monthly, quarterly, etc.). This approach helps in averaging the cost of investment over time, mitigating the risks associated with market volatility.
- Insurance Companies
- Mutual Funds
|
Returns |
| Fund Name |
5 Years |
7 Years |
10 Years |
| Max Life |
27.23% |
21.07% |
|
| Tata AIA |
30.99% |
21.69% |
|
| Bajaj Allianz |
24.23% |
12.8% |
|
| HDFC Standard |
25.77% |
14.87% |
|
| Canara HSBC Oriental Bank |
17.51% |
10.29% |
|
| Bharti AXA |
23.03% |
15.02% |
|
| Birla Sun Life |
26.67% |
14.18% |
|
| ICICI Prudential |
22.68% |
13.38% |
|
| LIC |
- |
- |
|
| PNB Metlife |
24% |
16.86% |
|
Fund rating powered by
Last updated: May 2025
| |
Returns |
| Fund Name |
3 Years |
5 Years |
10 Years |
| QUANT |
23.92% |
31.48% |
|
| PARAG PARIKH |
20.69% |
26.41% |
|
| EDELWEISS |
22.34% |
24.29% |
|
| KOTAK |
24.64% |
25.01% |
|
| MIRAE ASSET |
19.74% |
24.32% |
|
| PGIM INDIA |
14.75% |
23.39% |
|
| DSP |
18.41% |
22.33% |
|
| CANARA ROBECO |
20.05% |
21.80% |
|
| SUNDARAM |
18.27% |
18.22% |
|
Key Benefits of SIPs
The key benefits of a SIP plan are as follows:
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Rupee Cost Averaging: By investing regularly, investors buy more units when prices are low and fewer units when prices are high. This strategy averages the cost of investment over time.
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Power of Compounding: Returns generated from investments are reinvested to generate further returns, enhancing wealth creation over the long term.
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Affordability: SIPs can start with as little as ₹500 per month, making them accessible to all income groups.
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Financial Discipline: Regular contributions foster a habit of saving and investing, essential for achieving long-term financial goals.
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Flexibility: Investors can choose the amount, frequency, and duration of their investments, allowing for customization based on individual financial situations.
SIP Calculator
Monthly Investment
₹22.4 L
Top Funds with High Returns (Past 7 Years)
18.4%
High Growth Fund
17.46%
Top 200 Fund
14.57%
Accelerator Mid-Cap Fund II
14.81%
Opportunities Fund
10.58%
Growth Plus Fund
13.35%
Accelerator Fund
14.61%
Growth Opportunities Plus Fund
15.6%
Multiplier
11.48%
Equity Top 250 Fund
13.31%
Future Apex Fund
12.32%
Opportunities Fund
14.24%
Frontline Equity Fund
15.03%
Virtue II
10.88%
Pension Dynamic Equity Fund
11.8%
Equity Fund
10.32%
Blue-Chip Equity Fund
Example of a SIP Investment using a SIP Calculator
If you choose to invest ₹5,000 for a period of 15 years in a mid cap fund SIP plan, and your average expected SIP returns is 15%, the maturity amount you will gain at the end of this period can be calculated through a SIP Calculator:
This growth is due to Rupee Cost Averaging and the Power of Compounding over time.
Is SIP Safe?
SIPs are generally considered safe due to their structured approach to investing:
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Regulated by SEBI: All mutual funds, including SIPs, are regulated by SEBI. This ensures transparency and investor safety.
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Market Risk Exists: SIP investments are linked to the market. While they reduce risk through regular investments, they cannot completely avoid it.
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Low Risk Over Long Term: SIPs are safer for long-term goals. They reduce the impact of market ups and downs over time.
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Safe for Beginners: SIPs are a good choice for beginners as they are affordable and encourage disciplined investing.
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Portfolio Diversification: SIPs invest in a mix of sectors, reducing the risk of losing money in one area.
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Monitor Regularly: To keep your investment safe, review your SIP fund performance regularly and make changes if required.
What are the Risks in a SIP?
A SIP investment involves the following category of risks:
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Market Risk: SIPs invest in equity or debt funds that are subject to market fluctuations. Returns may vary based on market performance.
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Interest Rate Risk: Debt fund SIPs face risks when interest rates change, impacting bond prices and returns.
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No Guaranteed Returns: Returns from SIPs depend on market performance. They do not offer fixed or guaranteed returns.
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Liquidity Risk: Some funds have lock-in periods or may have low liquidity, restricting quick withdrawals.
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Inflation Risk: Returns from SIPs might not always beat inflation, especially in low-performing markets.
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Fund Performance Risk: Poorly managed funds may underperform, impacting your overall returns.
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Goal Mismatch: SIPs may not align with short-term financial goals due to market volatility.
Conclusion
SIP is safe for long-term investors. It allows you to invest in mutual funds regularly and helps reduce the impact of market ups and downs through rupee cost averaging. Though it carries market risk, SIP is good for wealth creation over time. It works best for those who invest regularly and stay focused on the long term.
FAQs
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Is SIP Safe?
SIP (Systematic Investment Plan) is considered safe when invested in diversified mutual funds with long-term goals. However, market risks can impact returns.
-
How safe is SIP for beginners?
SIP is suitable for beginners as it promotes disciplined investing. With
long-term investments, the market risks balance out, reducing the chances of loss.
-
What risks are involved in SIP?
SIP carries market risks as it invests in mutual funds, which can be impacted by economic conditions, interest rates, and market volatility.
-
Is SIP safe for long-term investments?
Yes, SIP is generally safe for long-term investments. The longer you stay invested, the better the chances of averaging market fluctuations.
