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 actually buys — regret protection, not extra return — and why each instalment is taxable.
- 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 solution-oriented category means for you.
- 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.