New Delhi, Aug. 11 -- Systematic Investment Plans (SIPs) are financial instruments designed to invest a fixed amount periodically in different mutual fund categories, with equity SIPs generally recommended for long-term investing. Data suggests that equity mutual fund investors should look beyond short-term returns as the probability of losing money tends to decline with longer holding period.

SIPs work on rupee cost averaging - which means, you get to buy more mutual fund units when the market falls and fewer units when markets are high - which lowers the average cost of buying in the long term. This means early withdrawals and stopping an SIP in a falling market give up the units that could have been accumulated at lower prices.

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