Thursday, February 13, 2014

Procedure to invest in mutual funds through Systematic Investment Plan (SIP)



Investment through SIP is a good investment vehicle which offers benefit of disciplinary regular savings and Rupee Cost Averaging.

One can start an investment plan through SIP mode by filling up the forms,
1) Common Application Form.
2) a SIP Enrolment Form. 
3) one Auto Debit Form.

First investment in SIP is done through a cheque of the same bank account through which the client wishes to avail Auto Debit Facility.


There are various options available to start an SIP with a mutual fund.

1) Branch Offices of MF - You can walk into any of the mutual fund offices (Reliance MF, TATA MF, ICICI Pru MF, SBI MF etc) and fill the application form for an SIP that you have chosen specific to that company.

2) You can start a demat account with any of the leading financial services providers like Karvy, Bajaj Capital, Bluechip. These companies will also be able to offer you advice about different mutual funds.

3) You can open a demat account with any of the leading banks like SBI, ICICI, Axis etc. You will be sent a user ID and password. You can log into their website and start your SIP in a fund from any mutual fund company.

The brokerage charges may vary marginally between all these options. However since you seem to be a computer savvy person, it would make sense to open a demat a/c and get a user ID. You can do your financial planning through the internet in the comfort of your home or office. You will not only save time but can take independent decisions by exploring different mutual funds yourself. You will also be able to check your portfolio at one glance and make changes as.