Author Topic: What is SWING Investment in SIP ?  (Read 142 times)

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What is SWING Investment in SIP ?
« on: October 23, 2020, 09:42:44 AM »
Assumption: I'm assuming you all are familiar with the concept of SIP.

Let me briefly explain what Swing Strategy in Mutual Fund SIP is.

Swing involves adding more money or removing excess on monthly basis from your mutual fund as every month the target is fixed which is equal to SIP Amount * Nth Month.


For example you start a of Rs 1000 every month.

First Month you BUY 100 units at Rs 10. RS 10 * 100 Units = Rs 1000 [Target Met]

Next month target is Rs 2000. Present NAV is Rs 11.
Target Rs 2000 -  (Rs 11 * 100 Units ) = Rs 900
So you only Add Rs 900 during Second month and get 81.81 Units. Total Units = 100 + 81.81 = 181.81

Say 3rd Month NAV Drops to Rs 8.00
Target for 3rd Month is Rs 3000
Present Value of Investment is Rs 8 * 181.81 = Rs 1455.
Contribution during 3rd Month will be Rs 3000 - Rs 1455 = Rs 1545 [Instead of 1000, you will invest 1545 and get 193.12 Units]
Unit Balance at end of 3 Months = 181.81 + 193.12 = 374.93

This should go on continuing for 10 years. Sure way to beat Returns Generated by SIP. Questions and Comments Welcome.