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Systematic Investment Plan (SIP) is a method of investing in mutual funds in a disciplined and regular manner. It is a tool that helps investors to invest small amounts of money regularly (weekly, monthly, or quarterly ) in a mutual fund scheme.
In an SIP, a fixed amount is deducted from the investor's bank account and invested in the mutual fund scheme chosen by the investor. This ensures that the investor invests in the market at different times and different market conditions, leading to a better average purchase price and ultimately resulting in better returns over the long term.
In Nepal, there exists a provision for Systematic Investment Plan (SIP) when it comes to mutual fund investments. Mutual funds are under the watchful eye of the Securities Board of Nepal (SEBON), who is responsible for regulating and supervising their operation throughout the country.
Investors can participate in mutual funds through SIPs by creating a mutual fund account with a registered mutual fund organization. The amount of investment through SIPs can be decided by the investor, and the Frequency of Investment can be set weekly, monthly or quarterly, depending on the mutual fund plan and the investor's preference.
The perks of investing in mutual funds through SIPs in Nepal are comparable to those in other nations. It allows investors to make disciplined investments, reducing the impact of market volatility and reaping the benefits of compounding.
In Nepal, investors have access to a variety of mutual fund options, including equity funds, bond funds, and balanced funds, among others. It is imperative that investors undertake their due diligence and select a mutual fund scheme that is aligned with their financial objectives and risk appetite.
Overall, SIPs are a favored and hassle-free method for investors in Nepal to invest in mutual funds and reach their long-term financial objectives.
