STP is a kind of SIP wherein the money, instead of being a fresh investment, comes from an investment in another fund. The point of an SIP is that it is not safe to invest a lump sum into equity funds at one go.
If you really want to invest a lump sum amount, it is better to invest it in a liquid fund and then give instructions for a part of it to be automatically redeemed from the liquid fund and invested into the equity fund of your choice every month.
For example, if you invest Rs 2 lakh into an equity fund and if the markets crash during that period, you would make a loss, and might be forced to enter into a debt of a personal loan or a home loan to finance your requirements. Further, to average out your buying price, you would put it all in a liquid fund and give instructions for say, Rs 25,000 to be shifted to the chosen equity fund for each of the next eight months. So, basically you will be starting off an STP from that into another equity fund! This will not provide you any type of gain but only will double your advisor’s commission.
If you want to make a good benefit by investing your funds into avenues which can guarantee you high returns in future, it is best you opt for the SIPs route. Not only does this provide you a channel for disciplined savings also, it can help you take your funds out off an investment if it is not performing well, thereby, enabling you to mere loses and not a loss of a lump sum amount which you might, otherwise, incur through an STP.