What Is Flex STP ?

What Is Flex STP?

What is Flex STP? A Smart Investment Strategy

Flex STP (Flexible Systematic Transfer Plan) is a unique feature offered by mutual funds like HDFC Mutual Fund that allows investors to transfer a variable amount from a debt scheme (Transferor Scheme) to an equity scheme (Transferee Scheme), based on market conditions and pre-set rules. This helps optimize returns by investing more when the market is low and less when it is high.

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Don’t let your lump sum lie idle — enter the equity market smartly and automatically with Flex STP.

💡 How Flex STP Works

Unlike traditional STPs where a fixed amount is transferred regularly, Flex STP dynamically adjusts the amount using a formula:

Transfer Amount = (Fixed Amount × No. of Installments including current) – Market Value of previous investments

The transfer is made only if there is a positive balance. If the market value of the investments already transferred is high, the next transfer amount reduces. If it’s low, the next installment increases — enabling a smart "buy more when low" strategy.

📋 Key Features

  • Frequency Options: Daily, Weekly, Monthly, Quarterly
  • Minimum Transfer Amount: ₹500 (Daily/Weekly), ₹1,000 (Monthly), ₹3,000 (Quarterly)
  • Minimum Installments: 6 for Monthly, 2 for Quarterly
  • Applicable Only for Non-Demat Units
  • Flex STP Target Scheme: Growth Option only

Why Wait? Let Your Money Work Smarter

Flex STP is ideal if you're sitting on cash and want to invest in equity at the right time — without timing the market!

✅ Benefits of Flex STP

  • Reduces risk of market volatility by averaging purchase cost
  • Transfers more when NAV is low, boosting long-term growth
  • Disciplined, rule-based approach to investing
  • Earns returns in the debt scheme while waiting to transfer

📊 Sample Illustration (From HDFC)

Fixed Transfer Amount: ₹5,000
Installment Date: April 15
Total Units Allotted Till March 15: 1,371.22
Current NAV: ₹9.00

Market Value: ₹12,340.91
Formula: (₹5,000 × 4) – ₹12,340.91 = ₹7,659.09
Transfer Amount: ₹7,659.09

📅 Transfer Dates and Frequencies

Frequency Available Dates
Daily Every Business Day
Weekly Monday to Friday
Monthly 1st, 5th, 10th, 15th, 20th, 25th
Quarterly Same as Monthly

🔒 Important Considerations

  • Read the KIM and SID of transferor and transferee schemes carefully
  • Exit load may apply on both transferor and transferee schemes
  • PAN and KYC compliance is mandatory
  • Flex STP stops if funds in source scheme fall below required value

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