System investment plan is the way of investment in which the investor invest the money regularly which may be daily,weekly,monthly or quarterly. This will reduce the loss chances and save from the markets ups and down. In this method, one can adopt a method of investing more in down market and investing less in up market.
System investment plan tells more buy on dips and less buy on ups which is the right method for investing.
System investment plan also tells that invest regularly instead of investing lump sump money in the markets.
System investment plan has no link with the mutual fund, as we generally suggest that SIP is related to mutual funds.
System investment plan make the average price of your investment in which chances are always high to have good profits instead of investing lump sump money at a point of time, which may give good returns but also can huge loss.One can invest in anything through the systematic investment plan which will be beneficial to the investor. For example, if one invest in silver or gold in MCX, he should adopt a systematic investment plan which will make average purchase by investing in regular intervals and reduced a lot of chances of loss, because the year average price will come back very soon, but year high price is very hard to see again soon.
So systematic investment plan is making the average of the investment which reduces the chance of loss and increase the chance of profits in either volatile or stable market.
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