What is the difference between SIP and lump-sum mutual fund investing?
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In mutual fund investing, a lump-sum investment involves a one-time payment of a large amount, while a systematic investment plan (SIP) allows you to invest smaller, fixed amounts regularly. SIPs are ideal for those with limited funds and help instill financial discipline. They also reduce market timing risk through rupee cost averaging. On the other hand, lump-sum investments are suitable for those with a higher risk appetite and access to larger funds. Both methods have their advantages, and the choice depends on your financial situation and goals.