Glossary· Ways of investing
What is STP?
Also known as Systematic Transfer Plan
A scheduled move from one scheme to another within the same fund house.
Typically parking a lumpsum in a liquid fund and transferring into equity over several months. Each transfer is a redemption from the source fund, so it is taxed like one.
For the formula and the constants behind this figure, see Methodology.
Guides that use STP
4 guides put this term to work.
- STP: how to deploy a lump sum without betting on one dateThe waiting money earns debt-fund returns instead of sitting in savings. What an STP buys — regret protection, not extra return — and how it is taxed.
- Structuring a portfolio for your child's higher educationThe one goal with an immovable date and inflation well above the headline. The glide path that gets you there, and what SEBI's discontinued category means.
- How to invest a windfall: inheritance, bonus, property saleThe first ninety days decide the outcome. Park it, take tax advice before moving anything, clear expensive debt, and stagger only the equity portion.
- Tactical asset allocation: shifting weights on valuationValuation predicts a decade and almost nothing about next year. You have to be right twice, and every move in a taxable account gives back part of the edge.
More on ways of investing
The transaction types the calculators model.
- SIP
- A fixed amount invested on a fixed date, usually monthly.
- Step-up SIP
- A SIP whose instalment rises by a set percentage each year.
- Lumpsum
- A single one-time investment.
- SWP
- A fixed amount redeemed on a schedule — a SIP in reverse.