SIP - ONE INVESTMENT PLAN WITH MANY BENEFITS:

Every person in today’s world want to earn some extra benefits. Sticking on just one source of income is not in practice now and of course, cannot be because of the hike in inflation rates. For earning more one need to get indulged in more than one source so as to get some extra earnings.
All of us are very much aware about the the concept of investment as well as the yields associated with it. Yes, we want to get maximum return on our investment with limited or no risk. Here comes the need to plan a proper investment so that we could get what we want.

INVESTMENT PLAN - DO YOU KNOW WHAT IT IS?
Planning is, thinking in advance about future scenario and then coming up with a strategy as to how we can achieve our goals in the future.
Accordingly, Investment Plan is a strategy of making investment, which is made for the future to earn maximum profits.

CHOSING A BETTER PLAN!
Which is a better plan?
The answer to this question cannot be in one or two words. This is because every one plans with some different objectives. For some, good returns with no risk is the main objective while for others the aim can be to earn high yield only.
But, in general sense, if we talk about the benefits of the investment plan, a better plan can be proved to be the one and only, which

• provides for comparatively high returns
• are less risky
• are safe and secured 

Why SIP (Systematic investment plan)?
Anything, which is done in a systematic way is proved to be efficient and effective. Similarly, the very concept of SIP is to provide for an effective and efficient plan of investment to the investor.

SIP,

• where one can start investment with a lesser amount of Rs 500 only per month.
• Periodically, a certain amount is debited from the bank account of the customer which is put into an investment project.
• Investor is benefited with the compounding power of the scheme.
• It also provides for cost benefit due to the rupee cost averaging concept associated with it.
• Early the investment more shall be the benefit it will fetch due to the compounding power.

Major benefits of SIP

Rupee cost averaging - We cannot predict the movement of market that whether it will go up or down. Even, the professional cannot provide us with the future fluctuation rates because they are very uncertain and depends on many different factors.
Rupee cost averaging here provides us to out of the guessing game of trying to buy less and sell high.
We can understand this concept with an example,
Suppose you invest Rs.1000 every month and NAV(cost) of the unit is constantly changing (increase or decrease), hence at the end of the year on calculating we will come to know that on an average basis we have invested less and earned higher as compared to that in case of lump sum, where the whole investment is made at one time only.
Accordingly, under the SIP scheme advantage of market dips can be taken.
Under this, the money shall buy more share (units) when price reduces and less when price increases and on an average shall provide for lesser cost.

Power of compounding - Compounding concept of finance refers to earning interest on interest. Under this, the investor earns interest on the principal amount and an additional interest on the interest so accrued on the principal amount.
An example for this can be , say you invest Rs 10000 at a simple interest of 10% for 10yrs. After 10yrs you will earn rs.20000.
On the contrary if you invest Rs. 10000 at 10% compound interest for 10yrs then after 10yrs you will earn Rs.27070 which is higher than simple interest.
SIP also provides for this compounding benefit as the interest earned on SIP is compound interest only.
To get benefited with the compounding scheme the investment shall be made for a longer period of time. Longer the period of investment, higher the amount of interest.

Less burden on the investor - one more important benefit of investing in SIP is its minimum capital investment limit.
This means in SIP an investment can be made by starting with an amount of just Rs.500 or Rs.1000 pm and this is really helpful for the less income groups.
So, we are not bound with any minimum capital requirement under this scheme.

Hassle free process - SIP does not require a regular attention of the investor. Once you are enrolled under the scheme, you can allow your bank to debit the amount automatically from your account and make investment.

This is how SIP can be a best investment plan for you. So just don't think more and start investing now via My SIP Online to earn a bundle of benefits.

Top Mutual Funds: A Supplement to Multiply your Money

Is there any substitute for the best? If given an option of choosing between a star rated product and an average product, what will you opt? Obviously, everyone will like to choose the best. Compromising on quality will save money for once but can cast an adverse effect over long-term. Therefore, one should always keep in mind the long-term effects along with other factors.

In the same way, selecting the top mutual funds for your investment will surely take your investment to new heights. Opting for a scheme which is not a good performer can result in decreased return and in extreme cases, loss of principal amount also. But then again a major question arises here is that how can one determine which fund is in the list of top ranking schemes?

The performance of the funds is measured through the rating provided by CRISIL (Credit Rating Information Services of India Limited). The score varies on a monthly or quarterly basis. But, the rating cannot serve as a benchmark to identify any fund as a top performing mutual funds. There are other factors involved; the major one is the past performance of the fund. CRISIL has very strict norms that have to be properly followed by all the schemes to get ranked by the agency. The fund needs to produce a performance record of past three years to the agency which should be according to the standard of the industry.

Selection Criteria of a Top Mutual Fund
Other than the rating aspect various other reasons make any scheme stand in line with the plans at the crest. They are as follows

• Past performance of the fund: The previous performance of the mutual fund should be the best in comparison to the other funds in its category. Whether regarding AUM, a number of clients and the rate at which it can serve the returns to its clients. It should follow continuity in its operations and have regular investments by the clients. 
• Consistency: Any fund to be ranked among the top fund should be able to show a consistent graph of performance. Monitoring the past performance does not mean that the fund performs well for the first year and starts showing downfall from the second year. A consistent growth pattern should be followed. 
• Fund Managers: The fund managers are the ones who maintain the portfolio of the clients. If the fund manager is experienced and well-versed with the market conditions, then he will prove to be a boon for the scheme and AMC altogether. Hence, any scheme having a proficient fund manager will always be the preferred scheme for investment by the clients.
• Assets Under Management (AUM): The assets that are managed under a particular scheme also decides its fate. As the AUM of any scheme rises it shows the progress graph for it. The rising AUM is enough to state the popularity of the plan and is very much essential to make it stand in the limelight easily. AUM depends on the category to which the fund belongs.
• History of Asset Management Company (AMC): AMC is the company which provides the various mutual funds, for example, SBI mutual fund, UTI mutual fund. The origin and the tenure for which it is operational decides the trust that the clients will have in the schemes. Let us take the example of UTI mutual fund. It is the first financial sector company of India. Thus, it has a reach to wider section as compared to any novice company like DSP BlcakRock mutual fund. So, a well-established AMC has greater chances of reaching the pinnacle as compared to a newbie AMC.

Some of the Top performing Scheme under various categories

The top funds are selected on the basis of different categories which the mutual fund industry provides. They are:

1. Equity funds: Equity schemes are the type of mutual funds which are based on providing capital appreciation having a high risk factor. The clients who can afford to take the risk are the prime targets of the AMCs. Therefore, one can observe the list of top performing funds which are ranked high on the scale of performance by CRISIL. There are various sub-categories like Large Cap, Small Cap and Mid Cap in equity funds.  
2. Debt funds: A category of funds which extend the benefit of fixed income generation for the clients. This means that the scheme ranks low on the risk meter and the priority list of the risk-averse customers. They are ready to sacrifice the returns but are not willing to compromise the security of their money. There are many types of debt funds like debt long term, debt short term, gilt funds, etc.
3. Hybrid Fund: The category of funds which invests in equity and debt funds equally. Hybrid funds provide the facility of capital appreciation as well as security in their investment by maintaining a balance between both. The client can enjoy the sweetness of debt funds and the sourness of equity funds in one single scheme.

Thus, we can see that the top performing mutual funds are able to facilitate an increased yield to the clients in return for their investments. My SIP online.com is one of the online investment portals which helps the clients to invest and redeem their investments in an easier way. Thus, invest and grow without any worries.

Plan Your Investments in a Better Way

SIP returns planner is a very simple yet a powerful tool which can be used by clients to calculate their returns on their investments through SIP. Talking of SIPs which are an investment methods for parking the surplus money in mutual funds which are presently gaining pace to become one of the most preferred investment mechanisms over a period of time. SIP calculator which is an online tool, helps the clients to compute the amount you need to invest regularly over a long-term to attain the financial goals that require copious amount. The investment objectives can vary from buying a house to planning for your child’s future. This calculator will not only help you to plan for your investment targets but will also make it clear that how much amount should be required to fulfill those aspirations. It is an important tool as it is the part of the planning mechanism. The clients need to plan before they invest and to plan they need accurate figures which will clear their concepts and open up avenues according to their capacity and help them to locate the correct scheme suitable for investment according to their needs and affordability.

For example, if a scheme provides 12% CAGR (Compound Annual Growth Rate) according to simple interest the expect growth will be 1%. But, the same is not true. SIP return calculator computes the return percentage on the basis of compound interest. Hence the the correct formula is CAGR = [(Current Value / Beginning Value) ^ (1/# of Years)]-1. This means that the client will get a return as per the formula i.e., (1+12%)12 -1 = 0.949%. It may appear to the clients that the difference calculating with simple interest and compound interest is very less. But, it creates a huge gulf when it comes to giving returns on the invested sum. The clients need to understand that a difference of even a .50% makes a the returns fluctuate to a high degree.

The above-mentioned formula may seem to be quite easy for computing once but when the calculation has to be done repeatedly for a long duration, then it becomes an intricate task for the investors. They take help of investment experts who sometimes tend to trick them into schemes which are not suitable for them or make them pay an amount greater than what may be required just to earn an appreciation in their salaries. To avoid all such problems the mutual fund experts have come with an innovative idea of automating all the mutual fund transactions. The clients now have access to a more lucrative option which makes it easier for them to create wealth. With a minimum amount of paperwork involved in the process, the clients are free to invest anytime and from anywhere. It is true that the clients have become independent and the cases of frauds have reduced due to the online process. Still the computation of SIP amount and the returns remains to be a tough task for the clients. To ease out this tautness an online tool has been devised known as SIP returns calculator. The clients have to make just a few entries and the result will be given to them within no time. Mutual fund investment planner works on the data with complete transparency and produces unambiguous results. This means that the clients have a trustworthy friend who will not only ease out their planning but will also make them create wealth according to their investment needs and affordability.

Summing up, one can say that SIP calculator not only makes the clients happy but also facilitates a better and secure way to calculate the returns, amount required to be invested along with the corpus in a quick manner. It is a freely available tool at My SIP Online which will provide access to better planning for your SIP. This tool at can be used both by online and offline investors equally. SIP calculators is a handy tool for all the investors and helps them to make investing decisions which suffice their requirements and suits their budget as well. 

Create Wealth Through Tax Saving Mutual Funds

If you fall into the tax bracket, then you might know that it becomes quite difficult to make judge the correct place to put the money for availing the rebate for income tax. Panama paper’s scam was brought to light recently. It depicted the list of those people who have violated several laws in order to save taxes. After this scam had been unraveled, it made people think that when the celebrities, businessmen, and politicians, who are considered to be the role models, are finding out illegal ways to save taxes then why not them. But, it is a wrong practice. The taxpayers should understand that they have much better options for availing tax benefits rather than unlawfully keeping their money with them. Schemes like Rgess has been launched to make the best use of your hard-earned money and providing taxation benefits at the same time.

Rajiv gandhi equity saving scheme was initiated by the government of india with a view to providing additional benefit of tax saving to the clients along with attracting investments in the retail market. The scheme has been named after the sixth pm of india mr. Rajiv gandhi and was launched in september 2012. This scheme aims at attracting those clients who have never invested in the stock market and earns up to rs. 12 lac annually, which was initially rs. 10 lac. There is a separate section defined for Rajiv gandhi equity savings scheme in the income tax act, which has been named section 80ccg.

A client who is keen to invest in Rgess should know that he will get an extra rebate of rs. 50,000 apart from the regular rebate of rs. 1.5 lac. It means that the tax benefit would be given only to 50% of the total amount invested in Rgess. If an investor invests rs 50,000 and falls in the 20% tax bracket, then he will be able to save 20% on 25,000 (which is 50% of 50,000). Hence, the client will be able to attain a taxation benefit of rs. 5,000. The benefit depends on the tax bracket to which the belong. Like all other tax saving schemes, there is a lock-in period of three years in Rgess also. But, it is quite less as compared to the other tax-saving mechanisms like ppf, where partial withdrawal is possible in six years and 15 years is the maturity period.

Rgess Benefit Under Various Taxation Brackets

Above figure shows the investment amount in descending order. This means that the client can invest a maximum amount of rs. 50,000 and a minimum of rs. 5,000 in the scheme and depending on the tax bracket they save tax. For example, if a client invests rs. 5,000 in Rgess scheme then he will get a rebate on its half,  I .E., rs. 2500. Then, if he falls in the 10% tax bracket, then he will be able to save rs. 258, while he will save rs. 515 for 20% tax bracket and rs. 772 for 30% bracket. Thus, it is evident that a client who invests in Rgess will be eligible to get a rebate on the fifty per cent of that amount, and the tax will be saved according to the taxation percentage of every client.

How Can A Client Invest In Rgess?

The clients should be clear that for investing into the Rgess fund, they need to have a personal demat account. Although there is a lock-in period of three years in the scheme, the clients are eligible to trade the holdings after one year has elapsed from the date of commencement of the scheme. This means that the investors should have shares worth the amount that has been invested in the Rgess scheme. Thus, the securities bought through the demat account under Rgess will accordingly be subjected to a lock-in for the first year of investment which is known as the fixed lock-in period. The investor is not allowed to trade the units of the Rgess fund during the fixed lock-in period. However, the client is able to trade them once the lock-in period gets over.

Thus, a client should invest in Rgess mutual fund for saving tax and building up a huge corpus as well. It is a golden opportunity for the clients to who have never traded in the share market and fulfill the other requirements. With the expansion of technology now it is possible to use online trading mechanisms for Mutual Fund Invest. Mysiponline provides you an apt platform to manage your money efficiently using an online approach.

Systematic Investment Plan: Better option for monthly saving

Systematic Investment Plan or SIP is one of the two methods of investing in mutual funds. The investors who were earlier unwilling to make one-time investment due to the involvement of a large sum in spite the desire to invest now have the option of investing in regular installments of SIP. The reasons can be any like, low income, the philosophy behind investment and many more. Keeping in view the restrictions that the clients faced while investing a lump sum, mutual fund experts felt the urgency to devise such a plan which could attract more and more investors who otherwise kept a distance from investing. SIP is similar to recurring investment but far better than that in many ways.

How SIP is better than other saving options?

As we all know that saving is entirely different from investing. But, many people equate RD and SIP. It is an entirely a wrong practice. To understand the vast difference among the two options the following points must be read:

• There are no time restrictions in SIP. As, there is no minimum or maximum period defined for sip investment. One can invest for longer duration in equity-oriented schemes while liquid funds help to invest for relatively shorter time duration. Unlike, other investment methods which have some minimum and maximum stipulated time-period. 
• The client doesn’t need a bulk amount, for investment. The idea behind investing through SIP is to reduce the burden of one-time investment from the shoulders of the client. But, you require a lump sum to invest in other options available for investing, like FDs. 
• An investor is free to withdraw the invested sum (after lock-in period if any), as and when required. There is no entry or exit load (in some schemes there is 1% exit load). But, if you withdraw your money from FD/RD before the maturity period, you will have to pay a penalty for it which will be deducted from the amount which the client had invested initially. Therefore, incurring a loss in the principle amount.
• SIP can be paid automatically through the bank account of the investor, making use of the facility called auto-debit/ECS. The investors need not go again and again to withdraw and deposit cash. But, same is not applicable to FD. An investor has to go to the branch repeatedly, either to commence the investment or to withdraw it. Standing instructions can not be given for same. 
• Systematic Investment Plan brings about financial cohesion. It is possible because the investor knows he/she will have to spare a certain amount for the purpose of investment. This automatically brings the income and expenditure in proper shape. But, in other investment options like FD, you have to accumulate money. The idle money in your account, during the process of accumulation, will attract you to spend it.

With the growth of technology, using SIP has become even more comfortable. SIP was designed as a method of investing in the mutual funds which followed a regular installment method. Now, you can use the auto-debit option to get your installment for SIP debited from your saving bank account. Just give a standing instruction to your bank for debiting the amount and from thereon you need not have to remember the date of paying SIP. You can also select your scheme through the various investing options provided by the AMCs. Now, it has become more easy for the investors to plan and pay their SIP installments.

Understanding SIP Investments In Three Simple Steps

Investors often have the notion that SIP is an investment in itself. It is a blunder to believe in such a myth. An SIP serves as a method of investing in mutual funds rather than being an investing mechanism. SIP is a special friend to the investors who are beginning their career and investment as well. We all know when a person takes up a job as a fresher, it is practically not viable for him/her to opt for lump sum as an investment method. However, they are paid enough to pull out a small amount from their salary to be invested monthly via SIP. Hence, penny by penny they can contribute towards accumulating a huge fund.

Automation is being widely accepted in almost every field, whether it may be education or investing. With the introduction of online investment strategy, the clients are able to get more freedom of investing as compared to the physical path. The investors can manage their money, decide the scheme in which they want to invest and also make the payment through various online mechanisms being extended by the banks.

Process of online SIP investment?
The online investing mechanism has undoubtedly decreased the tautness of clients. Mr Sharma was trying to find an answer to the question of how to invest in SIP, when his friend, who was already an investor, visited him. Mr. Sharma shared his dilemma with is friend and to satisfy the query his friend explained the following process involved in how to invest in SIP.

Analyzing your requirements
For taking the correct investment decision and choosing an appropriate scheme, the clients need to understand their requirements. It is rightly quoted, “An investor without an investment objective is like a traveler without a destination”. This phrase signifies the importance of having an investment objective before commencing the process of investment. Each individual has different nature and thinking. In the same way, every client has varying investment needs like some might invest to multiply their money manifolds to buy a property in the long run, while a few may want to save tax along with investing, etc. The reason may be any, but the realization of that need is necessary because it serves as the basis of selection for the type of scheme. Mutual funds have launched various schemes in order to suffice the needs of all investors. Thus, to select one of the plans from the wide range, clients have to identify their aspirations from the money they tend to invest.

Creating a personalized portfolio 
As you file all your documents in a folder manually, there is an online folder known as portfolio which holds a list all your investments including stocks, bonds and cash. There are two types of portfolios first, it is concerned with a scheme. The portfolio of a scheme holds the investment records of a particular plan. It managed by the fund managers and gives the information of the sectors where the scheme tends to invest. The client has no interference in the investment strategy and portfolio management of a plan. Second, is a personalized portfolio where the client’s investment details are recorded. When using an online investment strategy the clients enjoy a liberty to manage it according to their preference with the help of experts. A strong portfolio with a less number of scripts is far more better than the one with inappropriate and more number of schemes. Hence, creation and management of the portfolio can be done with the help of experts even in online investing.

Realizing payment in a safe manner
There are a lot of facilities have been launched by banks to provide handy service for their clients like ATM, debit/credit card, NEFT, RTGS, etc. All the facilities allow the clients to have a better approach to the bank transactions and making them easier to execute. With an increased use of online methodologies for buying and selling, clients require a secure payment mode. This not only reduces the time but also ensures that the payment is carried out through a safe mode. The same concept is applicable in online investing option also. The clients need not stand in long queues and wait for long first to withdraw and then to deposit the money. With the help of any of the online transaction facilities an investor can transfer the money safely from one account to the other.

The three-tier process depicts the overall working of an online investment strategy. The clients have the chance to be more independent and can adopt a secure investment avenue for their hard-earned money.

Get a better insight for organizing your investments

Have you ever seen a construction site? It is amazing to see how a sky-scraping building is constructed by placing the bricks in the right places. “Take care of small things and big things will automatically fall in place”, is a traditional saying which emphasizes on streamlining the tasks which appear to be small but produce a greater impact over the time. For example, for attaining a building, according to the plan, each brick has to placed accurately.

In the same way, investing is an activity that requires consistency and patience to attain desired gains. Mutual funds have been serving as one of the most secured ways of investing in stock market, bonds, securities, tax savers, etc. The clients can fulfill their needs with the help of investing in any of these instruments. Along with providing varied avenues of investing, mutual fund provides two methods through which the clients can place their money in any of the selected scheme viz, Lump Sum and SIP (Systematic Investment Plan).

What is SIP?

It is a method of depositing small amounts on a regular basis in any of the schemes selected by the clients. SIP was initially introduced to make the investment process easier as numerous clients are willing to sacrifice a huge sum at a time. This mechanism not only waves off the burden from the client’s shoulders but also makes it easier for him/her to invest more frequently. By investing as low as Rs. 500 through SIP plans clients can enjoy to accumulate a huge corpus over a prolonged period.
Top five SIP plans for 2016

There are a lot of mutual fund companies that provide innumerable schemes to the clients for investment. According to client’s risk-appetite and investment needs the clients can choose any of the schemes to invest their hard-earned money. The mutual fund experts mark some funds as the top SIP plans on the basis of the report of past 5-year performance, NAV index, Portfolio assessment, and Profit/Loss analysis report. There are following plans which have been rated to be the top five plans of 2016 in India:

1. DSP BlackRock Micro Cap Fund: It is an equity-oriented scheme which invests in small-cap and mid-cap companies. This scheme intends to apprehend the profits based on long-term growth potential of the newly established companies. Every small-cap and mid-cap company is in the initial years of business and consists the capability to make progress. DSP BlackRock Micro Cap Fund was initially launched in the year 2007 and has been able to mark its presence in one of the five top performing SIP funds. The AUM of the fund is Rs. 2,004.13 Cr which shows the popularity of the fund. The various options available under this top performing mutual fund in India are Growth, Dividend, Payout, Reinvest. There is an exit load of 1% for the investors who withdraw their money before the period of 12 months. 
2. Tata Balanced Fund: A balanced fund is one of the funds lying under the hybrid category whose major investments are in equity and relatively less portion is being invested in money market instruments. Equity investments provide the much-required growth of funds through capital appreciation while on the other hand, money market instruments facilitate fixed income benefits. Tata Balanced Fund is one the top performing funds under the hybrid funds category. The scheme is an open-ended fund and has 65:35 ratio of equity and debt respectively.         
3. ICICI Prudent Value Discovery Fund: This scheme is an open-ended diversified equity fund. Money invested through this fund is wisely diversified across various sectors of out economy like pharmaceuticals, banking, IT, etc. The fund manager contains a list of all those companies that are fundamentally strong and have ethical approach along with offering affordable stock prices. Hence, extending the benefits of capital appreciation over a long period.
4. Axis Long Term Equity Fund: It is also categorized under ELSS category. It has a three year lock in period and was started in the year 2009. There is no entry and exit load and it is an open-ended scheme. The scheme invests in sectors like banking, finance, consumer durable, etc. In a short span of seven years Axis Long Term Equity Fund has been able to make an impression among the investors and attain a position among the five most preferred SIP funds. 
5. L&T India Value Fund: The scheme aims at generating long-term capital appreciation by providing a diversified portfolio of equity and equity-related securities. The Scheme also invests in Foreign Securities in international markets along with the advantage of providing growth and dividend options.

Therefore, the clients should adopt SIP as their mode of investment which will undoubtedly help in accumulating wealth penny by penny over a long period of time.