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Our Bureau

Allows to enter with Rs 100 per month

Mumbai April 5 Aiming to help increased number of people access the benefits of investing in mutual funds and thereby the equity markets, Reliance Mutual Fund has reduced its minimum investment amount in its Systematic Investment Plan (SIP) to just Rs 100 per month.

Reliance Mutual Fund is the first Asset Management Company in the country to offer investment in SIP at such a low value per month.

Currently, the minimum investment for SIPs offered by most fund houses varies from Rs 500 - Rs 1,000.

"This move will reduce the entry barrier significantly," said Mr Vikrant Gugnani, President and CEO, Reliance Mutual Fund.

However, other fund managers from the mutual fund industry said it could increase the cost of servicing the accounts.

A fund manager said a fixed deposit for a small investor would offer better returns and expose him to less risk.

A systematic investment plan helps disciplined, regular investments in equities. With the entry level of SIP at Rs 100 per month, investors would be in a better position to use `rupee cost averaging' as investments spread regularly over a period of time would result in the average cost per unit coming down.

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