Systematic Investment Plans (SIPs) involve making a fixed periodic investment into an asset of your choice. SIPs are a well-known way of investing in mutual funds, but you can set up SIPs in various assets. SIPs play an important role in making investing accessible to a larger number of investors as they help them start small.
An advantage of SIPs is that since asset prices vary and the investment amount remains constant, investors would buy more at lower prices than at higher prices. This phenomenon is known as Rupee Cost Averaging.
