POSTED BY meeyush ON February 26, 2012 10:39 pm COMMENTS (4)

I have read that investing lumpsums have given better performance than SIPs in the span 1-2 years. What are your views on it?? Therefore I had asked if we do a STP at 3monthly basis of 30 k or do a SIP of 10k per month, which one would be better in terms off performance??

4 replies on this article “STP vs SIP”

  1. Dear Meeyush, I assume now you do have the idea for your next course of action. If you are still in doubt, please post your doubts & all of us ‘ll be happy to help you out.



  2. Sachin says:

    If you are planning to save 10K per month and planning to do of 30K STP after 3 months, the idea might not give great difference, STP will be usefull if you have 10L and planning to invest this 10L, so instead of keeping this money in bank, you can do STP and this approach can give you significant profit.

  3. BanyanFA says:

    Hi Meeyush,
    Lumpsum investment is a matter of luck if you are looking out for a period as short as 1-2 years. If you have a period of 10 years into consideration, then you would be making profits. Take into consideration investors who had invested in 2006/2007 on a lumpsum basis would still be sitting on losses. While, the investors who have invested on SIP basis would have made profits.

    Hence, I would advise that go for SIP basis and avoid lumpsum. Alternatively, if you are very bullish on using lumpsum, then have sufficient cash balances in hand to pump into the market to top up your investments. But again this would be reflecting upon the principles of SIP.



  4. Dear Meeyush, You mean to say that you are going to invest for next 1-2 or may be 3Y in Eq. & that too using mly or Qtly STP?

    My dear friend, a plain advice from side – Please do not invest in any Eq. MF, if your time horizon is not more than 2-3 years. Invest in Eq. funds only if you are going to remain invested at least for next 10-15 years.



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