The global equity markets have been highly volatile since the beginning of 2022. Markets, which were steadily recovering from COVID-19 blues, were again struck by multiple geopolitical and macroeconomic crises.
The Russia-Ukraine war, rising crude oil prices, surging inflation, tightening monetary policies of global central banks, increase in interest rates and persistent foreign capital outflows sent a shockwave throughout the markets. In 2022, foreign portfolio investors (FPI) have pulled out more than ₹ 1.7 lakh crore* from the Indian markets including equity, debt, and hybrid assets.
These factors led to heightened volatility in the equity market. The Nifty50 index, which rose 24.1% in the year 2021, is down 4.79%* in 2022 so far. Despite the volatility, India has been one of the best-performing emerging markets, with just the Nifty50 generating returns of nearly 35% since the beginning of 2020.
With the domestic economic growth coming on track, analysts expect Indian markets to perform well in the future, making now a good time for investment. However, since market volatility will continue to persist, HDFC Securities offers an alternative and cost-efficient way to reap profits from the market—DIYSIP. Find out how a stock market DIY investment plan works and why you should consider such a route.
What is a DIYSIP?
DIYSIP stands for Do-It-Yourself Systematic Investment Plan. Like Mutual Fund SIPs, you can make periodic investments in the stock market. You set a pre-determined amount to be invested in a basket of your preferred stocks at weekly, monthly, or yearly intervals.
Amid the rising popularity of stock investments in India, you can opt for the DIY Systematic Investment Plan or DIYSIP, which serves as an alternative to the lumpsum investment into higher-risk assets. It gives investors complete control over your investments and allows you to buy stocks in phases, based on the funds you have at your disposal.
DIYSIP allows systematic investment and could be a good option for those with a long-term investment timeframe. Along with a displaced investment strategy, investors can also make the most of volatile markets.
How does DIYSIP work?
The DIY aspect of Do-It-Yourself SIP means you can add to your basket stocks that you would like to invest in. Here’s an example of how it works:
- On your trading platform, you add stocks in a basket like how you would add items in a shopping cart.
- You then choose to put a fixed amount, say ₹5,000 every month for a year in that basket. Your broker places a purchase order for those shares based on your contribution.
- After a year, you would have invested ₹60,000 across five companies.
Features of DIYSIP
- Track your investments online: You can trade using online tools provided by your broker and keep an eye on the stocks at any time, any place.
- Modify your investments: You can increase or decrease the investment amount as per your financial upkeep for that period.
- Trade in stocks and ETFs: Along with pure company stocks, you can add gold or index Exchange-Traded Funds (ETFs) to your SIP basket.
- Pause or restart your DIYSIP: During a financial crunch, you can pause and restart your investment online. You will continue to gain profits from the existing investment.
Benefits of DIYSIP
- Affordability: Invest the amount in intervals you are comfortable with to avoid straining your finances.
- Lower average cost: Investing in stocks through SIP gives a cushion against downturns by allowing you to remain invested through the entire market cycle.
- No need to time the market: With DIYSIP, once you select the stocks and the amount, you can leave it be. Unlike trading, you are not required to monitor the market trends.
- Access to market insights: The decision of which stocks to invest in lies with you. However, the recommended equity SIP Value Picks enables you to make informed decisions quickly.
- Ease in investing: You can start your stock SIP investment within minutes. Select the stocks or ETFs, the amount you want to invest, the interval period and the date.
Invest in DIY SIP with HDFC Securities
Invest in top equities with a DIY SIP via HDFC Securities’ and add up to ten stocks or ETFs in one basket. To make it easy for investors such as you to determine the amount to invest and the timeframe, HDFC Securities also provides a DIYSIP calculator, which can help you estimate the potential returns and make informed investment decisions. To get started with investments in the stock market, and to benefit from innovative solutions such as DIYSIP, you can always open your Demat Account by clicking here.
* Source:
- https://www.fpi.nsdl.co.in/web/Reports/Yearwise.aspx?RptType=6
- From Nifty50 YTD chart
*Terms and conditions apply. This is an information communication from HDFC Bank and should not be considered as a suggestion for investment. Investments in securities market are subject to market risks, read all the related documents carefully before investing.
