Rupee-cost averaging

Rupee-cost averaging is what happens when you invest a fixed amount at regular intervals instead of one lump sum. The same money buys more units when prices fall and fewer when they rise, so your average cost per unit smooths out over time. It is the mechanism behind an SIP (Systematic Investment Plan). It does not remove market risk and it does not assure a profit — a market that only rises would have rewarded investing everything on day one. What it removes is the need to judge when to enter, which is where most people go wrong.