Which is better SIP or lump sum?|sip investment|lump sum investment

Q: Which is better SIP or lump sum?

Ans: Let's first talk about lump sum investment:

• In lump sum, a large amount or the amount which is available at your disposal is invested altogether in the equity fund or other investment options.
• In lump sum, your investment can be hugely affected by the up and down movement in the stock market.
• You should be well-versed with the stock market and its valuation.
• Lump sum investment gives better returns than SIP if you are going to keep the amount invested for at least 15 years. 
• The interest or return that you receive is compounded and you will earn more compared to SIP.

   Now about SIP (Systematic Investment Plan):

• These plans are best for the working class of people who earns on a weekly or monthly basis.
• In SIP you have to invest in the funds every month, quarter or in a set periodic set of time like an RD (Recurring Deposit).
• In SIP every month the amount is auto-debited from your account.
• It's a beneficial option since you will be saving every month.
• SIP benefits you when the market is very unstable. Since every month you will be getting units depending on the performance of the market. So sometimes you will be getting more units, sometimes less.

NOTE: Whichever investment you choose it's important, you select a good investment mutual fund broker for the same.  

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