Advantages of mutual fund investment

Investing in a systematic manner will allow you to leverage the power of compounding. This holds especially true for equities even when the markets are falling. However, instead of managing your portfolio on your own, you should ideally leave the task to a reliable mutual fund company in India.

Mutual fund industry in India helps investors fully exploit the potential of their investment portfolio. Mutual fund investment is indeed a sensible, long-term approach. Rupee cost averaging will help you see through the turbulent market and substantially cut down on the risk of investing even in volatile markets.

To elaborate, if you invest a fixed amount in a mutual fund scheme in a regular manner, you will get more units as the Net Asset Value (NAV) is lower. This helps you in lowering the average cost per unit. The strategy is termed 'rupee cost averaging'.

Through Systematic Investment Plan (SIP) with a leading mutual fund in India, you can make the volatility of the markets work well in your favor. Since the amount that you invest every month is the same, you as an investor will be buying more units with the price falling. In a bear market, this will clearly work to your advantage. And once the market starts looking up, the NAV would go up and the value of your original investment will multifold when the price gets higher. This will allow you to enjoy sustained returns over a longer period of time by investing your hard-earned money in a systematic way.

An effective Rupee Cost Averaging (RCA) strategy ensures that the average unit cost is lesser than the average sale price per unit. SIP helps you attain your long-term investment goals.