Systematic Investment Plan (SIP) HDFC MF SIP is similar to a Recurring Deposit.

Every month on a specified date an amount you choose is invested in a mutual fund scheme of your choice. The dates currently available for SIPs are the 1st, 5th, 10th, 15th, 20th and the 25th of a month. Youll be amazed to learn about the many benefits of investing through HDFC MF SIP. Click Here for Scheme Wise Details for SIP Benefit 1 Become A Disciplined Investor Being disciplined - Its the key to investing success. With the HDFC MF Systematic Investment Plan you commit an amount of your choice (minimum of Rs. 500 and in multiples of Rs. 100 thereof*) to be invested every month in one of our schemes. Think of each SIP payment as laying a brick. One by one, youll see them transform into a building. Youll see your investments accrue month after month. Its as simple as giving at least 6 postdated monthly cheques to us for a fixed amount in a scheme of your choice. Its the perfect solution for irregular investors.
*Minimum amounts may differ for each Scheme. Please refer to SIP Enrolment Form for details.

Benefit 2 Reach Your Financial Goal Imagine you want to buy a car a year from now, but you dont know where the downpayment will come from. HDFC MF SIP is a perfect tool for people who have a specific, future financial requirement. By investing an amount of your choice every month, you can plan for and meet financial goals, like funds for a childs education, a marriage in the family or a comfortable postretirement life. The table below illustrates how a little every month can go a long way.
Monthly Savings - What your savings may generate

Savings per month (for 15 years) 5000 4000 3000 2000 1000

Total amount invested (Rs. in Lacs) 9.0 7.2 5.4 3.6 1.8

Rate of return 6.0% 8.0% 10.0% (rupees in lacs, 15 years later)* 14.6 17.4 20.9 11.7 13.9 16.7 8.8 10.4 12.5 5.8 7.0 8.3 2.9 3.5 4.2

*Monthly instalments, compounded monthly, for a 15 -year period.

Disclaimer: The illustration above is merely indicative in nature and should not be construed as investment advice. It does not in any ma nner imply or suggest performance of any HDFC M utual Fund Scheme(s). Please read Risk Factors.

Benefit 3 Take Advantage of Rupee Cost Averaging

Most investors want to buy stocks when the prices are low and sell them when prices are high. But timing the market is timeconsuming and risky. A more successful investment strategy is to adopt the method called Rupee Cost Averaging. To illustrate this well compare investing the identical amounts through a SIP and in one lump sum. Imagine Suresh invests Rs. 1000 every month in an equity mutual fund scheme starting in January. His friend, Rajesh, invests Rs. 12000 in one lump sum in the same scheme. The following table illustrate how their respective investments would have performed from Jan to Dec:
Sureshs Investment Rajeshs Investment

Month Jan-04 Feb-04 Mar-04 Apr-04 May-04 Jun-04 Jul-04 Aug-04 Sep-04 Oct-04 Nov-04 Dec-04

NAV 9.345 9.399 8.123 8.750 8.012 8.925 9.102 8.310 7.568 6.462 6.931 7.600

Amount 1000 1000 1000 1000 1000 1000 1000 1000 1000 1000 1000 1000

Units 107.0091 106.3943 123.1072 114.2857 124.8128 112.0448 109.8660 120.3369 132.1353 154.7509 144.2793 131.5789

Amount 12000

Units 1284.1091

*NAV as on the 10th every month. These are assumed NAVs in a volatile market Disclaimer: The illustration above is merely indicative in nature and should not be construed as investment advice. It does not in any ma nner imply or suggest performance of any HDFC Mutual Fund Scheme(s). Rupee Cost Averaging neither ensu res you profits nor protects you from making a loss in declining markets. Pleaseread Risk Factors.

As seen in the table, by investing through SIP, you end up buying more units when the price is low and fewer units when the price is high. However, over a period of time these market fluctuations are generally averaged. And the average cost of your investment is often reduced.

At the end of the 12 months, Suresh has more units than Rajesh, even though they invested the same amount. Thats because the average cost of Sureshs units is much lower than that of Rajesh. Rajesh made only one investment and that too when the per-unit price was high. Sureshs average unit price = 12000/1480.6012 = Rs. 8.105 Rajeshs average unit price = Rs. 9.345

Benefit 4 Grow Your Investment With Compounded Benefits It is far better to invest a small amount of money regularly, rather than save up to make one large investment. This is because while you are saving the lump sum, your savings may not earn much interest.

With HDFC MF SIP, each amount you invest grows through compounding benefits as well. That is, the interest earned on your investment also earns interest. The following example illustrates this. Imagine Neha is 20 years old when she starts working. Every month she saves and invests Rs. 5,000 till she is 25 years old. The total investment made by her over 5 years is Rs. 3 lakhs.Arjun also starts working when he is 20 years old. But he doesnt invest monthly. He gets a large bonus of Rs. 3 lakhs at 25 and decides to invest the entire amount. Both of them decide not to withdraw these investments till they turn 50. At 50, Nehas Investments have grown to Rs. 46,68,273* whereas Arjuns investments have grown to Rs. 36,17,084*. Nehas small contributions to a SIP and her decision to start investing earlier than Arjun have made her wealthier by over Rs. 10 lakhs.
*Figures based on 10% p.a. interest compounded monthly. Disclaimer: TheThe illustration above is merely indicative in nature and should not be constr ued as investment advice. It does not in any manner imply or suggest performance of any HDFC Mutual Fund Scheme(s). Please read Risk Factors.

Benefit 5 Do All This Effortlessly Investing with HDFC MF SIP is easy. Simply give us post-dated cheques or opt for an Auto Debit from your bank account for an amount of your choice (minimum of Rs. 500 and in multiples of Rs. 100 thereof*) and well invest the money every month in a fund of your choice. The plans are completely flexible. You can invest for a minimum of six months, or for as long as you want. You can also decide to invest quarterly and will need to invest for a minimum of two quarters. All you have to do after that is sit back and watch your investments accumulate. Please refer to the SIP Enrolment Form for terms and conditions before enrolment.
*Minimum amounts may differ for each Scheme.