(MENAFN- AsiaNet News) Investing in mutual funds through systematic investment plans (SIPs) is a popular way to build wealth. However, some blunders might jeopardise your financial trip. Here are seven frequent pitfalls to avoid while using Mutual Fund SIPs.
![Planning for SIPs investments? 7 mistakes to avoid]()
Here are seven frequent pitfalls to avoid while using Mutual Fund SIPs.
![Not Following Your Investment Plan]()
Panic selling during market downturns or raising SIPs during bull markets might derail your investing plan. Stay focused on your investing plan and avoid market-driven decisions.
![Chasing Returns]()
It is risky to invest only in previous performance or top funds. Successful funds may underperform. Start with consistency, fund management, and investing goals.
![Overlooking Expenses]()
Mutual funds include expense ratios and exit loads. These expenditures might reduce profits over time. To max gains, compare fund expense ratios and pick SIPs with lowest fees.
![Ignoring Risk Management]()
Every investment contains risks that must be handled. Skip high-risk funds that don't fit your goals. Choose a diversified portfolio for long-term rewards and lower risk.
![Not Reviewing and Rebalancing]()
Markets evolve, and your investment portfolio should match your financial goals. Check your SIP portfolio and rebalance as needed to meet your goals.
![Ignoring Asset Allocation]()
Diversification and risk management require asset allocation, as do risky equity SIP payments. Your equity, debt, and gold should fit your risk tolerance and investing goals.
Without sufficient research, mutual funds can be risky investments. Before starting a SIP, research fund performance, management, cost ratios, investing goals, and risk profiles.
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