Systematic investment plans (SIPs) in equity mutual funds have managed to stay afloat over the past year, even as broader markets refused to move much. Thanks to rupee-cost averaging, over half the schemes across key active equity categories managed to deliver more than 5% returns for SIP investors in the one-year period, data from Value Research shows.
Considering that the Nifty 50 index remained flat during this stretch, and the broader NSE 500 actually slipped 1.7% for the year ended August 4. In contrast, lump sum investments in the same active equity schemes barely moved the needle. In the flexi cap category, for example, the median one-year return from a one-time investment stood at just 4.3%, while SIPs in the same category returned around 6%.
The Nifty 50 swung across a 4,500-point range, making it hard to predict short-term outcomes. But that volatility opened up a few windows. Fund managers had opportunities to reallocate capital, and SIP investors unintentionally bought into dips, benefitting from cost averaging.
Retail investors didn’t flee during the correction phase between September 2024 and February 2025. Monthly SIP inflows stayed strong at around ₹26,000 crore during that period and touched fresh highs in the past three months.
However, the market correction did trigger a noticeable uptick in SIP account closures—suggesting that while the money came in, some investors got cold feet along the way.
Fund selection, as always, made a difference. Of the 250 schemes analysed across flexicap, largecap, smallcap, midcap, multicap, large & midcap, ELSS and focused categories, 26 delivered over 10% SIP returns during the past year. But it wasn’t all good news. Around 20 schemes in the same categories ended up delivering negative returns—reminding investors that not all SIPs are created equal.
