Rishi,
See my comments below.
(1) As suggested by you, to change within the same fund company, I will do a STP. Wanted to know whether the STP will automatically stop (or cancel) the SIP first and then trigger the STP - or I will have to first Stop the SIP and then initiate STP?
Raj : STP and SIP are different, both will run in parallel. You can stop SIP and then start STP. (If both are present, both will be running, one will invest and other will transfer : there is no point in doing this)
(2) Although you have tried to asnwer, but I am still not clear about this one Rajendra Ji. Let's say I have a SIP in Fund-1 where I have invested a total of 1 lakh in past 3 years (through monthly SIP). Now I am changing to Fund-2 (with a different company). I will start a new SIP in Fund-2 going forward as you suggested and stop the SIP in Fund-1. BUT how will I make sure that the 1 lakh coming out of Fund-1 also gets invested into Fund-2.
Raj : Fund-1 amount will not come automatically. You have to either redeem whole units/amount or do a systematic withdrawl.
If that does not get invested, then the pupose of long term investment will be lost.
Raj : Yes. Or else you can slowly move into some debt fund from same fund house.
Do you suggest that I should purchase one-time funds worth 1 lakhs in fund-2 and keep it with me till the time the new SIP continues? or I should pour this 1 lakhs into Fund-2 slowly through a parallel SIP of 5-6 installments? Kindly explain this to me.
Raj : Always go thru SIP or STP only. Go systematic way either in investing or withdraw or transfer.
(3) Last one - what is the difference between a "Switch" and "STP" in HDFC ISA?
Raj : Switch is done one time with in same fund house - either sell by units or amount
STP is like done over a period of time like SIP.
Thanks
Raj
See my comments below.
(1) As suggested by you, to change within the same fund company, I will do a STP. Wanted to know whether the STP will automatically stop (or cancel) the SIP first and then trigger the STP - or I will have to first Stop the SIP and then initiate STP?
Raj : STP and SIP are different, both will run in parallel. You can stop SIP and then start STP. (If both are present, both will be running, one will invest and other will transfer : there is no point in doing this)
(2) Although you have tried to asnwer, but I am still not clear about this one Rajendra Ji. Let's say I have a SIP in Fund-1 where I have invested a total of 1 lakh in past 3 years (through monthly SIP). Now I am changing to Fund-2 (with a different company). I will start a new SIP in Fund-2 going forward as you suggested and stop the SIP in Fund-1. BUT how will I make sure that the 1 lakh coming out of Fund-1 also gets invested into Fund-2.
Raj : Fund-1 amount will not come automatically. You have to either redeem whole units/amount or do a systematic withdrawl.
If that does not get invested, then the pupose of long term investment will be lost.
Raj : Yes. Or else you can slowly move into some debt fund from same fund house.
Do you suggest that I should purchase one-time funds worth 1 lakhs in fund-2 and keep it with me till the time the new SIP continues? or I should pour this 1 lakhs into Fund-2 slowly through a parallel SIP of 5-6 installments? Kindly explain this to me.
Raj : Always go thru SIP or STP only. Go systematic way either in investing or withdraw or transfer.
(3) Last one - what is the difference between a "Switch" and "STP" in HDFC ISA?
Raj : Switch is done one time with in same fund house - either sell by units or amount
STP is like done over a period of time like SIP.
Thanks
Raj