Rupee Cost Averaging
Investing term
Rupee cost averaging is the effect of investing a fixed amount regularly: you automatically buy more units when prices are low and fewer when prices are high.
This lowers your average cost per unit over time and removes the temptation to time the market. It is the core benefit of investing through a SIP rather than as a single lump sum.
More investing terms
SIPA SIP is a way of investing a fixed amount in a mutual fund at regular intervals — usually a set sum every month — instead of investing a lump sum.XIRRXIRR is the single annualised return that accounts for investments made on different dates — the right way to measure a SIP's actual return.CAGRCAGR is the constant yearly rate at which an investment would have grown from its starting value to its ending value over a period.NAVNAV is the per-unit price of a mutual fund — the fund's total assets minus its liabilities, divided by the number of units outstanding.Expense RatioThe expense ratio is the annual fee a mutual fund charges, expressed as a percentage of your invested amount, deducted from the fund before the NAV is calculated.ELSSELSS is a type of equity mutual fund that qualifies for a tax deduction under Section 80C, with the shortest lock-in of any 80C option — just 3 years.