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Are SIP’s working in long term for Equity ??? Myths & Facts Below

Myth: SIPs prevent losses when done over long periods.

Fact: SIPs cannot prevent losses, even over the long term, if the markets are in a sideways phase. 

Myth: SIPs fetch higher returns than lump-sum investment

Fact: While the two are not comparable, SIP by itself doesn’t work to increase returns over the long term. It partly depends when you start and end your SIP
Myth: Even when investors have no idea what the market will do, they can expect to beat the market by using SIP

Fact: The basis for SIPs is the assumption that the market, on average, goes up over a long investment horizon. This assumption is true for a very long period (10 years or more) but may not be true for your investment horizon. There are no blind but safe bets in the market

 

Source : Moneylife

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