First Ever Monthly SIP Cap Rs25000

The SIP inflow sees record high

• Despite the market remaining at an all-time weak, the monthly systematic investment plan (SIP) inflow made a maiden all-time high in India at Rs 25,323 crore in October, from Rs 24,509 crore in September, according to the latest data from the Association of Mutual Funds in India (AMFI) on Monday (NASDAQ:MNDY). In 2023 the same month the SIP inflow was recorded at Rs 16,928 crore.
• The number of SIP accounts stood at its highest ever at 10.12 crore in October 2024. It was 9.87 crore in September. Net 24.19 lakh SIP accounts were added in the last month.
• According to AMFI data, open-ended mutual funds performed well in October. This was the 44th consecutive month that inflows into equity mutual fund schemes have been positive. Open-ended equity mutual fund inflows surged 21.69 per cent on a month-on-month (MoM) basis to Rs 41,887 crore in October.
• Last month, strong investment was recorded in all categories including smallcap, midcap, and largecap. Inflows into the largecap fund category doubled on a monthly basis in October to Rs 3,452 crore. Net investment in the midcap fund category increased by 50 per cent on a monthly basis to Rs 4,683 crore. Inflows into the smallcap fund category surged by 23 per cent on a monthly basis to Rs 3,772 crore.
• Sensex and Nifty have fallen by 5.77 per cent and 6.22 per cent, respectively in October. Inflows into sectoral and thematic funds fell 7 per cent month-on-month to Rs 12,279 crore in October. Last month, new fund offers in the sectoral and thematic funds category raised Rs 3,517 crore. There was an inflow of Rs 1,57,402.30 crore in the fixed-income category, debt mutual funds.
• The highest investment of Rs 83,863 crore was recorded in the short-duration liquid fund category in October. Overnight funds and Money market funds saw inflows of Rs 25,783 crore and Rs 25,303 crore, respectively in October.
• For the uninitiated, SIP is an investment methodology to invest in mutual funds wherein one could invest a fixed amount in a scheme at fixed intervals, say once a month rather than investing lump-sum. The SIP amount could be as small as Rs500 a month. This is similar to a recurring deposit where you deposit a small amount every month.

Why Invest in SIP?

• Rupee cost averaging: They enable investors to make the most of rupee cost averaging. In other words, you do not need to find the right timing of buying mutual fund units. You happen to invest in a staggered way as a result of which your average purchase price is an average of different prices at which you buy the units across the tenure of SIPs. For instance, when you buy in six monthly instalments, your buying price is the average price of six different prices at which you bought them during those six months.
• Investing discipline:Since you are investing in regular gaps, you happen to inculcate an investing discipline. And as you know, investing discipline is key to wealth creation.
• Ease of investment:As one would imagine, investing via SIP is far more easier and convenient than via lumpsum investing.
• Flexibility:SIPs offer flexibility of investment in terms of frequency in which one could invest in mutual funds that could be monthly, weekly or quarterly.

Editor’s Note