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Is SIP supported in Dividend schemes of mutual funds?

It might be a very silly question, but is SIP supported in dividend scheme. I tried to do SIP for MOSL focused 35 fund but it says SIP not supported.

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2 Approved Answers

Mridul Agrawal

In SIP, you invest a fixed amount of money in a mutual fund of your choice every month. The set up is such that the money is automatically debited from your bank account.

The purpose of a dividend scheme is to earn income in regular intervals through the investment in the form of dividends.

Technically, an investor is allowed to go for an SIP in a dividend scheme. However, doing so essentially defeats the purpose of an SIP, wherein an investor is looking to invest surplus funds periodically.

This forms a cycle, wherein the core purpose of both the options is not fulfilled.  

Ishan

Yes, Its possible to do a SIP in dividend schemes but its not the best way to invest. 


The purpose of dividend schemes is to earn income from your investments where as SIP is a way of investing monthly from your regular income. So it doesn't make sense to do SIP in dividend schemes.


Check more about dividend schemes: https://groww.in/blog/growth-fund-vs-dividend-fund/


So, SIP in dividend funds is deactivated on groww.


Hope this helps.

Ishan Bansal


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