Target Investment Plan (TIP) by ICICI Direct

Target Investment Plan (TIP) by ICICI DirectTarget Investment Plan (TIP) by ICICI Direct

Target Investment plan (TIP) is a product offered by ICICI Direct. In Systematic Investment plan, you invest a fixed amount per month in Mutual funds. However, Target investment plan is a goal oriented approach to invest in Mutual funds. Under Target investment plan, you need to set the Target amount, expected rate of returns and timeframe. Based on this, every month the investment amount in mutual fund is altered based on the current value of the portfolio.  

How does Target Investment Plan work?

When you set the target amount, returns and timeframe, every month your current value of portfolio is valued and the future amount of investment per month would be altered accordingly.

Let me explain this with an example

Assume you have chosen Rs. 3 Lac as Target to be achieved in 24 months with an expected return of 9%.

The average monthly amount required to achieve the target would be Rs. 11,500 every month.

Supposing after the first month, the market is in a downward trend, and the portfolio value falls to Rs. 9,200. In such a case, the second installment would not be Rs. 11,500, but would be Rs. 13,800, i.e. [(11500*2)-9200].

After the third month, suppose the markets rise and the portfolio value now is Rs. 27,000 then Rs. 7,500 i.e, [(11500*3- 27,000)] will be invested.

Thus TIP establishes the target portfolio value by periodically calculating the investment amount, and bridging the gap between the target value and the actual portfolio value.

Features of the Target Investment Plan (TIP)

  1. Varied monthly investment: The monthly value of TIP would get changed based on the value of the portfolio month on month.
  2. Works on Smart investment strategy: This works on Smart investment strategy like Invest more when the markets are down and invest less when markets are high.
  3. Comparing to SIP:  This Target investment plan is not an alternative for SIP. The principles are different. Under SIP, the investment amount is fixed per month, however in TIP, the investment amount varies month on month.
  4. Ahead of target, you are in comfortable zone: In case you are ahead of target by any month, the investment amount reduces keeping you in comfortable zone.
  5. Complex during volatile markets: Under volatile markets, investment through TIP would create complexity month on month as investment amount differs.
  6. Cannot modify TIP: You cannot modify the TIP. You can only cancel the TIP and re-create a fresh one.
  7. Success depends on timing of market: Success of the TIP depends on the timing of the market. If your goals are during bear markets, you need to invest more and if your goals are during bull markets, you need to invest less. This product was launched more than a year back, the success ratio is yet to be determined.

Target Investment Plan Vs Systematic Investment Plan (TIP Vs SIP)

  1. TIP works on varied monthly investment. Under SIP, you need to invest fixed amount per month in mutual funds.
  2. Under TIP, your target amount is known. In SIP, your final returns would not be known.
  3. SIP works on rupee cost averaging i.e. you would invest fixed amount irrespective of market levels. Whereas under TIP, you invest towards achieving the goal. You invest less when markets are high and invest more when markets are down.
  4. TIP would be useful more towards when you want to achieve a goal. SIP is more useful when you want to invest a fixed amount to gain more without any target amount.

What are the TIP mutual funds currently available in ICICI Direct

Currently, ICICI Direct offers 4 mutual fund schemes under this plan. They are HDFC Top-200 mutual fund, Franklin India Prima Plus, ICICI Pru Dynamic Plan and UTI Opportunities Fund

Conclusion: Target Investment plan is best suitable for those investors who want the target amount to be achieved within a time period and willing to invest more money in volatile markets.

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Target Investment Plan (TIP) by ICICI Direct


  • Dharmesh

    I think as TIP works target would not be achieved where as it would be just (Monthly Inv. * Tenure). so in above case 11500*24= 276000 where as our target was 3 Lacs.


  • Kirthi

    As the review and returns are not yet specified clearly not sure of its success, never heard of any icici rep mention of same to me…can someone invested in this and sip give ur feedback

  • Sambit

    if some one interested on the above 4 funds only TIP is a best option but it will be unbeatable if they offer TIp for all mutual funds.

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