How to start SIPs with Smallcase? | Smallcase How To Guides

by Navyaa

Published On May 22, 2024

In this article

In recent times, more and more people are becoming interested in investing. However, there are many that may not have a substantial sum of money readily available to start investing. A Systematic Investment Plan (SIP) is one of the ways these investors can begin their investment journey.

An introduction to SIP

A Systematic Investment Plans (SIPs) is an investment method that allows investors to start investing by depositing smaller and manageable amounts at regular intervals, instead of depositing a large sum of money all at once. This method allows investors to invest a fixed amount of money at regular time intervals into mutual funds , smallcases , or other investment options. A systematic investment plan follows the philosophy of "save first, then invest," which not only encourages disciplined saving habits among investors but allows individuals with low capital availability to start investing.

When an investor invests under a systematic investment plan, they select a fixed amount that they wish to invest and the frequency of the investment. The time interval for this investment can be daily, quarterly, monthly or yearly. This fixed amount then gets automatically deducted from the investor’s account at selected intervals and is used to buy mutual funds based on the net asset value (NAV) or cost of the mutual funds at that point of time. With each interval, the new additional mutual funds purchased are added to the investor’s account. This process results in an increase in the investment amount as well as the return over time.

The key principles of SIP

The systematic investment plan operates on two key principles, resulting in its effectiveness:

Rupee Cost Averaging

Through a systematic investment plan, investors invest a small fixed amount at regular interval instead of making a lump sum investment. This approach allows them to take advantage of the market volatility. When prices are low, the fixed amount buys more units, and when prices are high, it buys fewer units.

For example, Let's consider two investors, Investor A and Investor B, both investing in the same mutual fund. Investor A chooses to invest through SIP, investing Rs.1000 twice over a period of 2 months. During the first month, the NAV is Rs.10,while it is Rs.20 for the second month. So, Investor A could buy 50 units (Rs.500/Rs.10) + 25 units (Rs.500/Rs.20) at per unit cost of Rs.15 (Rs.1000/75). However, investor B invests a lump sum of Rs.1000 when the NAV is Rs.20. So he buys 50 units (Rs.1000/Rs.20) at per unit cost of Rs.20.

Although both invest the same total amount, Investor A ends up with more units due to the rupee cost averaging principle of SIP. Additionally, Investor A's average cost per unit is lower than Investor B's, because some units were purchased at ₹10 and some at ₹20, resulting in a lower overall average cost.


In a systematic investment plan, compounding works by reinvesting both the additional sum of money and the returns generated by the existing investment back into the plan. This means that instead of only earning interest on the initial lump sum investment, investors earn interest on the total accumulated amount, including both their investment and the returns. As a result, over time, the investment grows faster, as the returns themselves start generating further returns i.e. we see compounding returns (CAGR). This continuous cycle of reinvestment and growth helps the investor to earn more and build wealth overtime.

Read this article to understand How to Rebalance Your Smallcase Portfolio: A Step-by-Step Guide

Which investor should invest in SIPs?

New Investors

Investors who are new to investing and do not have a lot of knowledge about the financial market can start their investing journey through SIPs. Through a systematic investment plan these investors can start with small, manageable amounts. This will give them the opportunity to gradually learn and help them gain confidence while minimizing risk.

Long-term Investors

The investors who are looking to invest for a long period of time in order to achieve their future financial goals, such as retirement, children's education, or buying a home can invest through SIPs. By investing regularly over the long term, SIPs take advantage of the power of compounding , which significantly increases returns. They reinvest the new deposit made as well as the returns earned from the existing investment which helps investors earn higher profits in the long run.

Budget-Conscious Investors

SIPs are the perfect choice for the individuals who want to invest within a fixed budget. Under SIPs, investors have flexibility in terms of the amount they want to invest. There is no fixed minimum amount to start. This allows investors to start with amounts as low as they are comfortable with and gradually increase their investment as their income grows.

Read this article to Understand Smallcase Returns, Lock-In Periods, and Minimum Investments

Busy Professionals

Since there is an option of auto deduction under SIPs, investors do not need to constantly adjust and monitor their investment. Once a fixed amount and time interval has been decided, the process is fully automated. This allows investors who may not have the time or expertise to invest without any time hassle.

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Why choose Smallcase for Your SIP Investments?

A Smallcase is an investment product through which investors can invest in a basket of stocks or Exchange-Traded Funds (ETFs). Each Smallcase is created by SEBI registered financial experts or analysts also known as smallcase managers and represents a complete investment portfolio.These portfolios are based around specific themes, ideas, or strategies, such as large-cap stocks, value investing, or dividend yield. Investors have the option to select a Smallcase that matches their investment needs and financial goals.

For SIP investments, choosing Smallcase can offer several advantages:


Smallcases are specially made portfolios and they normally consist of multiple stocks or ETFs. By investing in a Smallcase through SIPs, investors can spread their investment across multiple companies or sectors. This not only reduces the impact of market fluctuations but also minimizes the overall risk.


These investment portfolios provide clear visibility into their holdings, performance, and investment strategy. This level of transparency helps the investors to understand exactly what they are investing in and to track the progress of their investments over time. This information not only helps investors make informed decisions about their future investment but also increases their confidence.

Created by experts

These investment portfolios are created and overseen by experienced and SEBI registered financial experts and analysts. These experts specialize in specific themes, ideas, or investment strategies on which the portfolios are based. This ensures that the portfolios are backed by research and data.


Investing in SIPs through Smallcases provides convenience and is less time consuming. Once an investor chooses a Smallcase that fits their investment plan and goals , they have an option to set up automatic monthly deductions from their bank accounts. This not only ensures that the investments are made on time but also removes the need for constant monitoring and adjustments.

Specific themes

Each Smallcase is based on a specific theme or idea, including different sectors, market trends, or investment strategies. This approach ensures that investors can select a portfolio suits with their risk tolerance , industry preferences, and financial goals. By offering a diverse range of options, Smallcases ensures that the unique and specific needs of each individual investor is being met.

SIPs For Smallcase Works Differently Than Mutual Funds

SIPs in Mutual Funds

Systematic Investment Plans (SIPs) in mutual funds are a popular way to invest regularly and benefit from the power of compounding. When you initiate a SIP in a mutual fund, your money is pooled into a common fund. The fund then allocates units to you based on your contribution. This process means you own units of the mutual fund rather than individual stocks. Typically, the minimum SIP amount is Rs. 500, making it accessible for most investors. This method allows for disciplined investing, regardless of market conditions.

SIPs in Smallcases

Investing in smallcases through SIPs operates differently. When you invest in a smallcase, you hold actual stocks in your demat account instead of units of a fund. This provides direct ownership of the stocks in the smallcase. There are two types of SIPs in smallcases: Manual and Auto.

Manual SIP

In a Manual SIP, you initiate each SIP installment manually. This allows for flexibility, enabling you to adjust your investment based on market conditions or personal financial planning. Here's how it works:

  • Example: Consider a smallcase with 20 stocks, equally weighted, and an initial investment of Rs. 1 lakh. After 30 days, you decide to initiate a SIP order of Rs. 10,000 every month.

  • Weight Adjustment: Over these 30 days, stock prices change, altering the weightage of each stock. The core focus of your SIP is to bring back the weights of the stocks to their ideal configuration (10% each in this case). Therefore, funds will first be used to buy more of the stocks that have fallen below their target weights before buying others.

  • Minimum SIP Amount: The minimum SIP amount for any smallcase must be at least 2 times the highest priced stock in the smallcase. This ensures you can buy at least one share of the highest priced stock along with other stocks. For example, if Tata Motors, priced at Rs. 989, is the highest priced stock in your smallcase, the minimum SIP amount would be Rs. 2,000.

Auto SIP

Auto SIPs are more convenient and automated. Once set up, the SIP amount is automatically debited from your account at the specified frequency and invested in the smallcase.

  • Execution: The minimum SIP amount is equal to the minimum investment amount of the smallcase. Auto SIPs execute based on the number of shares rather than stock weightage. For example, if you initially purchased 5 shares each of 10 stocks, an Auto SIP will buy the same number of shares for each stock in every installment.

Comparing Manual SIP with Auto SIP on Smallcase

The key difference between manual and auto SIPs is how they are executed. Manual SIPs adjust for stock weightage, while auto SIPs maintain the number of shares.


Manual SIP

Auto SIP


Based on stock weightage

Based on number of shares


Manual initiation, adjustable

Automatic, consistent purchase of shares

Minimum Amount

2 * Highest Priced Stock

Minimum investment amount of the smallcase


Focuses on maintaining ideal stock weights

Buys same number of shares in each installment

Both mutual funds and smallcases offer SIP options, but they cater to different investment preferences. Mutual funds provide pooled investments with units allocated to investors, while smallcases allow direct stock ownership in your demat account with flexible SIP options.

Find top performing smallcases to invest in with SIPs.
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Starting an SIP with Smallcase

Step: 1

  • Tick the SIP option when purchasing the Smallcase, or

  • Navigate to the Investments tab, select the desired Smallcase, and choose "Start SIP" from the More Actions menu.

Step: 2

  • Upon clicking ‘Start SIP,’ you will be asked to confirm this action and informed that SIP acts as a reminder and does not automatically place orders on your behalf.

  • After confirming investing through SIP, you can click on ‘Continue’ to complete the process (or) if you want to make any changes to the frequency or start date, you can click on Edit SIP (You are free to edit your SIP at any time)

  • In the SIP overview pop-up, choose the frequency (weekly, fortnightly, monthly, or quarterly) and start date for your SIP.

  • The SIP investment amount starts at as low as Rs. 294, which can be adjusted higher if needed.

  • Your SIP installment due date is calculated based on the chosen frequency and start date.

  • Review the historical performance to understand the potential outcome of your SIP investment over the past three years.

  • Click "Save SIP" to proceed.

Step: 3

  • Upon clicking "Start SIP," confirm your action and note that SIP serves as a reminder and does not place orders automatically.

  • After confirming, click "Continue" to finalize the process. You can also click "Edit SIP" to make changes to the frequency or start date.

  • To end your SIP, select "End SIP" at the bottom of the Edit SIP window. You have the option to terminate your SIP at any time.


Starting a SIP with Smallcase is a convenient and efficient way for new investors to enter the financial world using only their available savings. With the ability to invest in specially created portfolios made by expert financial analysts, investors can benefit from diversification, transparency, and convenience in their investment journey.

Read these comprehensive Smallcase How To Guides to understand all you need to know about Smallcases:

  1. Understanding What is Smallcase and How Does it Work?

  2. Features & Benefits of Investing in Smallcases

  3. 8 Things To Check Before Investing In A Smallcase Portfolio

  4. Should You Invest In Smallcases? Are Smallcases a Good Investment?

  5. Understanding the Importance of Rebalancing Your Smallcase Investments

  6. How to Use Existing Demat Accounts to Invest in Smallcases

  7. How To Choose Between Different Types Of Smallcases

  8. Understanding Smallcase Returns, Lock-In Periods, and Minimum Investments

  9. Understanding Smallcase Fees, Charges, and Taxes

  10. How to start SIPs with Smallcase?

  11. How Many Smallcases Should You Have in Your Portfolio?

  12. Where can I view my saved smallcases?

  13. How to Evaluate Smallcase Performance Using CAGR & XIRR

  14. Why Use XIRR Instead of CAGR To Evaluate Your Smallcases Performance

  15. How to Reinvest in a Smallcase You Had Once Exited From

  16. How to Partially Exit or Sell Individual Stocks in Smallcases

Read these articles to learn about key investment methodologies and concepts related to SIPs & Investment Advisors that can help you setup your portfolio:

    1. SIP Investment Guide: What is SIP, How to Start, Benefits, & Is It Worth It
    2. What is SIP in Mutual Funds? An Experts Guide
    3. Navigating the Challenge: How to Deal with Loss-Making SIPs
    4. Maximizing Portfolio Potential: The Role of an Investment Advisor
    5. Best SIP to Invest In Now for Maximum Returns: A Strategic Guide for Indian Investors
    6. SIP vs STP: Understanding Key Differences and Strategies
    7. SIP vs. Lumpsum Investment Strategies: Comprehensive Guide for Best Returns
    8. Comprehensive Guide on Starting & Stopping SIPs: What are Perpetual SIPs in India?

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