Retail investors continue to invest in mutual funds through SIP. Mutual funds received Rs 8,095 crore of its assets through SIP in February 2019, 26 per cent higher year-on-year, shows data from Amfi. Mutual funds collected Rs 8,064 crore through SIPs in January 2019.

“Amid global uncertainty, tension at the border, liquidity tightness and credit events, retail investor behaviour to stay invested is quite heartening. The continued healthy confidence that retail investors are showing, as is reflected in rising number of SIP inflows is laudable. The patience to stay invested amid uncertainty, will help from the individual long term wealth creation perspective. Once political uncertainty and liquidity tightness recedes over the next few months, we expect the inflows in both equity and liquid funds to strengthen further,” says N. S. Venkatesh, CEO, AMFI.

Mutual funds currently have about 2.59 crore (25.9 million) SIP accounts through which investors invest in regularly.
Systematic Investment Plan, or SIP as it is commonly known, is an investment plan (methodology) offered by mutual funds. It allows investors to invest a fixed amount periodically, say, once a month, instead of making a lumpsum investment. The SIP instalment amount could be as small as Rs 500 per month. SIP is similar to a recurring deposit where you deposit a small /fixed amount every month.

SIP is a very convenient method of investing in mutual funds through standing instructions to debit your bank account every month, without the hassle of having to write out a cheque each time.

SIP has been gaining popularity among mutual fund investors, as it helps in rupee cost averaging and also in investing in a disciplined manner without worrying about market volatility and timing the market.

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AMFI data shows that the MF industry had added about 9.15 lakh SIP accounts each month on an average during the FY 2018-19, with an average SIP size of about Rs 3,125 per SIP account.

See the table below for month-wise amount collected through SIPs from FY 2016-17.

Month SIP Contribution (Rs crore)
2018-19 2017-18 2016-17
Total during FY 84,638 67,190 43,921
March 7,119 4,335
February 8,095 6,425 4,050
January 8,064 6,644 4,095
December 8,022 6,222 3,973
November 7,985 5,893 3,884
October 7,985 5,621 3,434
September 7,727 5,516 3,698
August 7,658 5,206 3,497
July 7,554 4,947 3,334
Jun 7,554 4,744 3,310
May 7,304 4,584 3,189
April 6,690 4,269 3,122

Source: Amfi



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