How to do STP from liquid fund

I have 57 lakhs. I want to invest in four equity mutual funds. I try to do it through my demat account. First I try to park my money in liquid fund. When I search the liquid fund most of them have only SIP and SWP option but no STP. Is it ok to do SWP and do SIP for the mutual fund?

Apr 18, 2017 by T Vanlalmalsawmsanga,   |   Mutual Fund

Yes you can do STP by parking the lump sum fund in liquid fund and transfer daily/ weekly/ Fortnightly or monthly to equity funds.

Please note that to do STP to an equity fund you need to invest in the liquid of the same AMC. If you are investing in 4 different equity funds of 4 different AMCs then you need to park the lump sum amount in the respective liquid funds.

Please check this link to see how the STP works https://www.advisorkhoj.com/mutual-funds...

In case you are investing through a stock broker and want to hold the units in demat account then you need to contact your stock broker and understand the exact method as to how they set up the STP through demat route.

As your investment idea is to do STP we are not answering the SWP part as both are very different investing concepts. STP method is to transfer from one fund to another and benefit from rupee cost averaging over a period of time. Whereas, SWP is about investing the lump sum amount in a fund of your choice and draw a fixed amount regularly on a fixed interval.

In case you have some doubts further, do write to us in details.

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