Systematic Transfer Plan. Stp stands for systematic transfer plan. In essence stp combines the features of swp sip.
Stp when used prudently can help investors earn smart returns on their investments. A systematic transfer plan stp is a method of investing in mutual funds. A systematic transfer plan entails moving a fixed amount of money or units every interval from one mutual fund scheme to another.
For example an stp can transfer rs 10000 each month from axis liquid fund to axis bluechip fund.
Stp refers to the systematic transfer plan whereby an investor is able to invest lump sum amount in a scheme and regularly transfer a fixed or variable amount into another scheme. Ideal for investors who want to invest lump sum money in schemes with stable returns and ensure small exposure to equity schemes in order to avail of the potential for higher growth through equities. Systematic transfer plan stp is a useful tool like systematic investment plan sip. It is a disciplined investment plan and helps reduce propensity to market fluctuations.