Nippon Small Cap, Tata Small Cap and HDFC Defence Fund stop lumpsum investments! How does it affect your SIPs?

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Nippon Small Cap, Tata Small Cap and HDFC Defence Fund stop lumpsum investments! How does it affect your SIPs?

What Has Changed?

Nippon Small Cap fund, Tata Small Cap Fund and HDFC Defence fund have temporarily suspended accepting new lumpsum investments. While you may be curious about the reasons behind this move, it's essential to understand the rationale.

For HDFC defense fund, only SIP is allowed and that also with an investment limit of upto 10k per month.

The suspension of new lumpsum investments is a precautionary measure usually taken by the funds to safeguard the interests of existing investors and maintain the fund's overall stability. It is typically implemented during volatile market conditions when a sudden influx of lumpsum investments can pose challenges in deploying these funds effectively.

Why Some of Your SIPs May Be Impacted?

You might be wondering how the suspension of lumpsum investments affects your SIPs. Well, it's all about the way SIPs are processed. We place your SIP installments as automated lumpsum transactions which helps us to provide you with anytime edit/pause features. It also helps you to set up daily/weekly SIPs.  All these features are not offered in a normal SIP offered by the AMC (Mutual fund house) 
Hence, due to the temporary halt on lumpsum investments, your future SIP installments are also impacted and will not go through. 

What Should You Do Now?

Now that you are aware of the changes and their implications for your SIPs, you might be wondering what your next steps should be.
Consider Setting up a Fresh SIP: If you'd like to continue your investments during this period, you have the option to establish a new SIP. It's important to note, however, that this new SIP may not provide the same level of flexibility as the lumpsum transaction-based SIPs. Specifically, you won't have access to features such as anytime editing, pausing, or stepping up your investments.

Cancel or Manage Existing SIPs: If you decide to set up a new SIP, you may want to consider canceling or managing your existing SIPs in this scheme. You can do this by accessing your account and navigating to the "Transactions" section, followed by the "SIP" tab. From there, you can pause or cancel your existing SIPs.