Ch.2 · Advantages and Limitations of Mutual Funds · medium
Which of the following correctly describes rupee cost averaging in SIP investments?
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EXPLANATION
Rupee cost averaging works through SIP: a fixed amount invested each month buys more units when NAV is low (market down) and fewer units when NAV is high (market up). Over time this averages out the purchase cost per unit, reducing the impact of market volatility.
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