I have already invested in SIP MF. Just wanted to know Is it a good idea to invest in Value-averaging investing plan (VIP)? Could you please provide more clearity on the same?
Nilesh-I don’t think long term investors must opt this and create headache 🙂
In VIP, sometimes you have to invest more (during market fall) and in other cases you have redeem the units (during uptrend in market). So bear in mind about exit loads and taxation too. Also, you have to keep surplus to make sure that this strategy works. Because during falling market, you have to invest more and more. If you are ready to take such pains then go ahead. In my view, I strictly stick to simple SIP.
Thanks for the info Basu.But still my doubt is not cleared.What i understood is its just like flexi sip.For ex. I keep VIP amount ranges from 1000-5000 per month.So during market fall my 5k will get invested and during high market gain it would be between 1k-5k.I would be glad if you write a complete blog on VIP in Mutual Fund.So investors will get the exact idea about it.Thanking you in advance for the blog.?
Nilesh-I already answered. You may do many experiments, but at the end who stays for long term will get benefits. There are many posts written the benefits of VIP. But do consider the time period they considered to arrive at these benefits. They do it which benefits to them while writing. However, I am not against the VIP. But what I am pointing is, it will not create that much of difference.