A systematic investment plan involves investing a consistent sum of money regularly, and usually into the same security.
A SIP generally pulls automatic withdrawals from the funding account and may require extended commitments from the investor. SIPs operate on the principle of dollar-cost averaging.
A systematic withdrawal plan (SWP) is a scheduled investment withdrawal plan typically used in retirement.
Investors can structure SWPS in various ways.
Mutual funds typically allow an investor to determine a systematic withdrawal plan that includes interval payouts monthly, quarterly, semi-annually, or annually.
STP is a strategy where an investor transfers a fixed amount of money from Source scheme to Target scheme
Systematic Transfer Plan (STP) enables a disciplined and planned transfer of funds between two mutual fund schemes. In most cases, investors initiate an STP from a debt fund to an equity fund.
While an STP is a good strategy, you should be aware of the tax implications and exit loads on the transfer.
