What is Rupee Cost Averaging?

Introduction

 One of the greatest secrets behind SIP success is Rupee Cost Averaging (RCA) — a strategy where you invest a fixed amount at regular intervals, no matter where the market is. 

 This results in buying more when prices are low, and less when prices are high — automatically averaging your cost over time.

How Does Rupee Cost Averaging Work?

Let’s say you invest ₹5,000 every month in a mutual fund. Here's what might happen:

 📉 Outcome: Lower average purchase price, reducing market timing risk.

  Real-Life Example: Deepak’s Goal Planning Deepak started a SIP in 2020 for his daughter’s education goal in 2035.

• Over 5 years, markets fluctuated wildly — COVID crash, recovery, inflation.
• But his consistent ₹6,000/month investment averaged his entry cost to ₹52/unit, despite the NAV ranging from ₹40 to ₹75.

✅ Helps avoid emotional investing

Conclusion 

 You don’t need to time the market if you master Rupee Cost Averaging. It’s how smart investors build wealth — automatically.

Stick to your SIPs. Let RCA silently reduce your cost and increase your returns over time. Summary Table: Rupee Cost Averaging Explained