With a fixed SIP amount, you automatically purchase more mutual fund units when the NAV is lower and fewer units when it is higher. Over time this can lower the average cost per unit compared with irregular investing.
Rupee cost averaging does not guarantee profit or protect against loss in declining markets, but it helps remove emotional timing decisions. Continuing SIPs through corrections is a key part of disciplined investing.
Illustrative only. This article is for education only and is not investment advice.