King Vikram: Consider this: If Rs5000 was invested every month through an SIP in HDFC Equity Fund (HEF) since 1 January 2008, when equity markets were skyrocketing before it tanked, you would have got a return of 39.22% by end-2010. However, if you had invested the entire Rs1.80 lakh as a lump sum, you would have earned just 10.80%. A similar SIP, however, started on 15 March 2009 when markets started to rise, would have yielded 43% till date compared with 69% if you had invested the entire amount as a lump sum. We compared SIP and lump sum returns for a couple of large-cap-oriented equity funds, HEF and Templeton India Growth Fund, and a mid-cap-oriented fund, IDFC Premier Equity Fund, over the past five years and the difference in returns were negligible.
Analysis-: In rising market lump sum investment wins but in volatile market SIP is better in all the aspects.
As an investor you always look forward to investing in an asset class that would maximize your returns and history shows that equities as an asset have been most rewarding. Investing in equities isn’t a cakewalk though. It requires a lot of patience and research to build a fortune with equities. We at Right Horizons, through the Systematic Investment plan {SIP] make it possible for you to benefit from investing in equities.
No comments:
Post a Comment