Rank MF, a mutual fund distribution arm of Samco Securities has introduced a new SIP facility ‘smart SIP’ that recommends clients to shift their equity fund SIPs in liquid funds if market valuations are high based on the margin of safety.
The MF distributor has introduced three SIP variants under its Smart SIP facility - SIP Plus, Smart SIP and Smart SIP Plus..Based on the margin of safety in the markets, this facility would give four different options to clients – continue sip when markets are reasonably valued, skip SIP when markets are expensive, skip SIP and book profit when markets are extremely expensive and increase SIP when markets are relatively cheap.
Jimeet Modi, Founder and CEO, Samco Securities said, “In recent times, SIP has been gaining popularity among Indian investors. With the new facility, investors can enhance their SIP returns by buying low and selling high.”
Explaining the product, Omkeshwar Singh, Head-RankMF said, “Traditional SIPs involve investing a fixed amount of money in a mutual fund scheme at the same date every month. This is done irrespective of the level of the markets and the valuations at which the market is trading. We have back tested the new facility and found that investors can generate an additional CAGR of 8% if they follow this strategy.”
