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           SIPs are a method of investing in mutual funds. You invest a certain pre-determined amount at a regular interval in the mutual fund. This might be once each week, once each month or once in a quarter. If you have given ECS mandate, money will be automatically debited from your bank account and invested in the mutual fund scheme of your choice. Units of the mutual fund scheme are allocated based on the NAV (Net Asset Value) of the scheme for that day.

How are SIPs related to mutual funds?
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       C.S. Sudheer, founder, www.happytohelptech.in , said mutual funds are a professionally managed trusts, where money invested by you and other investors are pooled and invested in stocks, debt or a mix of stocks and debt, depending on the type of mutual fund. SIPs are just a method of investing in mutual funds and to understand better, one should know these difference between mutual fund and SIPs. It is a smart and hassle-free method of investing in mutual funds. Through SIP you can invest a certain, fixed, pre-determined amount at regular intervals of time like once a week, month or quarter. Doing so, SIPs give you the twin major benefits of rupee cost averaging and the compounding benefit
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