How long should one remain invested in an SIP? Is it better to shift to another SIP after receiving around 500 units from the earlier one?
Amit Shanbag, Mangalore
You could remain invested in an SIP of a mutual fund for as long as you wish depending on your investment goal and the performance of the fund. It is advisable to review the performance of the fund in which you have a SIP once a year so that you know how it is faring to continue or change your investment to another fund. However, you should be aware that SIP is a facility to invest regularly in a disciplined manner. Given the fluctuations in the market, an SIP enables you to continue investing without seeking to time the market. The inherent nature of SIPs allows you to put your investments on auto mode. Therefore, there is no need to make a further timing decision in an SIP, wondering about the time to be in it and the time to shift. Choose from schemes with good track records, and go for a one-year SIP from the OLM Elite list when you review the decision to continue or make any changes.
