Daily Systematic Investment Plan

The systematic Investment Plan is ideal for those investors who have a regular flow of money i.e. employees. A simple instruction to the fund house and the bank and that simple mechanism can avoid the risk of volatility of market. When we invest say Rs. 1000 per month, we get fewer units when price is high and gets more units when share price is low. The reinvention of the Systematic Investment Plan has become a boon for investors with a low risk appetite. Rupee cost averaging and compounding are added advantages.

Simply a daily SIP is a plan which collects a small sum from any individual investors on a daily basis and invests this amount in the stock market. It operates like any mutual fund where the disbursement and handling of the money is the fund manager’s prerogative.

Rupee cost averaging occurs when the market goes down, and more units of the scheme can be purchased because of a lower net asset value. However, most companies have SIP schemes that allow you to invest on different dates of the month. Daily SIPs are expected to minimize risk and generate greater risk-adjusted returns while increasing participation.

Daily SIP: Advantages

Affordability, volatility and convenience are the most obvious advantages of investing in a Daily SIP. It captures the daily levels of market volatility. In case of monthly SIP investor can lose if the markets are up on the chosen day of month, while in case of daily SIP, it eliminates this flaw of market and investor get the benefit of volatility of stock market.

If any investor is looking for lump-sum investment, then going with daily SIP would allow him to take advantage of the market volatility, by splitting the lump-sum amount in to daily installments over a relatively short time frame. The daily SIP is ideal for small time savers, since the threshold investment level is low.

Once you start with a Daily SIP, you invest at the appointed time and that makes you a disciplined investor. With Daily SIPs, you capitalize on the periodic dips in the market and accumulate a greater number of units at lower levels–and over time, reduce your average unit cost.

The Fed Reserve

The Federal Reserve system is the central bank of the United States and one of the world's most important, influential and prestigious financial organization. It was established by congress in 1931 with a primary objective of to provide the nation a safer, more flexible and more stable monetary and financial system. The Fed Reserve system is run by a board of Governors which is directly appointed by president of United States. The Fed includes 12 regional Reserve banks and their branch offices, as well as the Federal open Market Committee (FOMC).
Now let me tell about some major responsibilities of The Fed.-

1- Contributing to the formation of the nation's monetary policy by influencing monetary and credit condition in economy.

2- To make sure that the safety and soundness of the nation's banking and financial system, and protecting the credit rights of consumers through supervision and regulation.


3- To maintain the security and reliability of the financial system and containing systematic risks that may arise in financial markets.

4- To provide payment and financial services to the US government, financial institution and foreign financial institution.

5- Stores monetary gold for foreign central banks, government and official international agencies.

6- To implements monetary policy set by the FOMC.