How SIP works?
In an SIP by investing a fixed amount at regular interval, you can take advantage of the market volatility. By investing at different NAVs the average cost per unit comes down. This is also known as Rupee Cost Averaging.
|Regular investment (`)
||Unit price (`)
- Total investment = `10,000
- Total units purchased = 1003.03
- Average cost price = `9.97
By opting for SIP, investor would have 1003 units at an average price of `9.97. Had the investor opted for lump sum investment of `10,000, investor would have got 1000 units at `10. SIP enables one to invest across market cycles thus bringing the cost price down, which contributes to the returns on investment.
The above example is only for illustration purposes. It should not at any point of time be construed to be an invitation to the public for subscribing to the units of Canara Robeco Mutual Fund Scheme.