Systematic Investment Plans (SIPs) have revolutionised mutual fund investments by enabling individuals to invest small, consistent amounts over time. For investors, understanding the SIP return rate is crucial to evaluating how well their investments are performing. With mutual fund apps, tracking and optimising SIP return yearly or monthly has become easier, making these platforms invaluable for managing investments.
This article delves into the basics of SIP return rates, how they are calculated, and the role of mutual fund apps in simplifying your investment journey for achieving high SIP returns.
What is an SIP return rate?
An SIP return rate refers to the growth percentage of your investments over a specific period when invested systematically through SIPs. This rate depends on factors such as:
- The mutual fund scheme chosen
- The duration of the SIP
- Market performance during the investment period
SIPs work on the principle of rupee cost averaging, where you buy more units when prices are low and fewer units when prices are high. Over time, this method smoothens out market fluctuations and potentially offers high SIP returns.
Calculating SIP return rates
1. Absolute returns
Absolute returns show the percentage gain or loss on your total investment over a specific time period. The formula is:
Absolute Returns = [(Current Value – Invested Amount) / Invested Amount] × 100
2. Annualised returns
Annualised returns indicate the growth rate of your investment over a year. This is useful for understanding the SIP return yearly in comparison to other investment options.
3. XIRR (Extended Internal Rate of Return)
XIRR is the most accurate way to calculate SIP returns as it accounts for multiple investments made at different times. Mutual fund apps often use this method to provide precise figures.
SIP return monthly vs yearly
Investors often compare SIP monthly returns with yearly returns to understand the growth trajectory. Monthly returns provide short-term insights, while yearly returns give a long-term perspective. For instance:
- SIP monthly returns: Show how well your portfolio performed in a given month, helping you track market trends.
- SIP return yearly: Reflects the overall performance of your SIP for the year, offering a broader view of your investment’s growth.
Both metrics are important for tracking and adjusting your investment strategy.
Benefits of tracking SIP returns with mutual fund apps
Mutual fund apps have transformed how investors monitor their SIP returns. These platforms offer:
1. Real-time updates
Apps provide real-time updates on your portfolio’s performance, allowing you to monitor your SIP return rate and make timely adjustments.
2. Simplified calculations
With in-built calculators, apps automatically compute metrics like XIRR, absolute returns, and annualised returns, saving you time and effort.
3. Goal tracking
Many apps let you set financial goals and track how well your SIPs align with them, ensuring you stay on the right path.
4. Comparative analysis
Evaluate the performance of different schemes to identify funds delivering high SIP returns, helping you optimise your portfolio.
How to optimise SIP returns
To maximise your returns, consider these strategies:
1. Choose the right funds
Selecting mutual funds with a history of strong performance is key. Look for funds that align with your risk appetite and financial goals.
2. Invest for the long term
SIPs are most effective over long durations as they leverage the power of compounding and rupee cost averaging.
3. Increase SIP amounts periodically
Gradually increasing your SIP amount with rising income can significantly boost your corpus and returns.
4. Diversify your portfolio
Diversify across equity, debt, and hybrid funds to balance risk and reward, ensuring consistent SIP return yearly.
5. Use mutual fund apps for insights
Leverage mutual fund apps to analyse trends, compare funds, and monitor returns efficiently.
Why mutual fund apps are indispensable for SIP management
Mutual fund apps simplify SIP investments and returns tracking by offering:
1. Instant portfolio access
View your investments and track SIP return rates anytime, ensuring you remain informed about your portfolio’s performance.
2. Customised SIP planning tools
Apps offer SIP calculators to estimate returns for different investment amounts and durations, helping you plan your financial goals effectively.
3. Dividend tracking
For dividend-paying mutual funds, apps provide timely updates, ensuring you don’t miss any payouts.
4. Secure transactions
With advanced encryption, mutual fund apps ensure your financial data is protected while making SIP transactions.
Why Bajaj Finserv is the best app for SIP tracking
Comprehensive tracking tools
Bajaj Finserv simplifies tracking with tools that provide detailed insights into your SIP return monthly and yearly performance.
Fund recommendations
The app suggests funds tailored to your goals, ensuring you can identify schemes with high SIP returns.
Real-time updates
Stay updated on market trends, fund performance, and NAV changes, enabling informed decision-making.
User-friendly design
Its intuitive interface ensures hassle-free navigation, making it suitable for both beginners and experienced investors.
Goal-based investing
Set financial goals and use the app’s tracking features to align your SIP investments with them.
How to start tracking SIP returns with Bajaj Finserv
Step 1: Download the app
The app is available on Android and iOS platforms.
Step 2: Complete your KYC
Complete your KYC verification digitally to start investing immediately.
Step 3: Set up your SIPs
Choose a mutual fund scheme, set your SIP amount, and automate monthly contributions.
Step 4: Track your returns
Use the app’s tracking tools to monitor SIP return yearly and optimise your portfolio for maximum growth.
Conclusion
SIPs are a powerful tool for wealth creation, but understanding and tracking your SIP return rate is essential for maximising their potential. Mutual fund apps like Bajaj Finserv have made this process seamless by offering real-time updates, advanced tools, and secure transactions. Whether you are looking at SIP monthly returns or aiming for high SIP returns in the long term, these apps ensure you stay informed and make smarter decisions.
Take control of your financial future by leveraging the power of mutual fund apps. Download Bajaj Finserv today and simplify your investment journey for a brighter tomorrow.
