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    Question

    Refer to the following information to answer the next 4 questions (Q27 to Q30) Mutual funds are investment vehicles that pool money from many investors to purchase a diversified portfolio of stocks, bonds, or other securities. This allows individual investors access to a broader range of assets than they might be able to manage on their own. Investors seeking to optimize their financial strategies often consider different types of investment plans that suit various financial goals and life stages. In mutual funds SWP, SIP, and STP are three such strategies that enable investors to manage their finances with flexibility and precision. Each of these plans serves a unique purpose, ensuring that investors can tailor their investment approaches to fit their specific financial needs and future aspirations.

    In the domain of mutual funds, what is the main

    objective of a Systematic Investment Plan (SIP)?
    A To allow for a lump sum investment at the beginning of the investment period Correct Answer Incorrect Answer
    B To permit the investor to withdraw a fixed sum of money at regular intervals Correct Answer Incorrect Answer
    C To facilitate the gradual investment of funds over a period Correct Answer Incorrect Answer
    D To automatically transfer funds from one type of investment to another Correct Answer Incorrect Answer
    E To track and manage the dividends received from mutual fund investments Correct Answer Incorrect Answer

    Solution

    SIP refers to Systematic Investment Plan, a popular investment method where small periodic investments are made, typically in a mutual fund, to build wealth over time.

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