15-year vs 3-year SIP — Which offers a higher probability of returns? Anil Singhvi explains

Systematic Investment Plans (SIPs) continued to remain the biggest support for the mutual fund industry in December, even as overall assets under management (AUM) saw a marginal decline, according to market expert and Zee Business Managing Editor Anil Singhvi.

Speaking during the Mutual Fund Ki Masterclass, Singhvi said there was “no reason for concern” over the slight fall in industry AUM, adding that investor confidence and discipline remained intact.

The overall mutual fund AUM dipped marginally to around Rs 80.23 lakh crore in December from about Rs 80.80 lakh crore in the previous month. Singhvi said the decline was insignificant in the context of such a large industry size.

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“In an industry of over Rs 80 lakh crore, a difference of Rs 50,000–55,000 crore does not matter,” Singhvi said. Equity mutual fund AUM increased during the month, while equity inflows stood at around Rs 28,000 crore, slightly lower than November’s Rs 29,900 crore. Singhvi described the trend as stable.

“Equity inflows are slightly lower, but Rs 28,000 crore is still a strong number,” he said.

SIP inflows emerged as the standout performer in December. Monthly SIP contributions crossed Rs 31,000 crore for the first time. The previous high was around Rs 29,500 crore.

“SIP numbers show that Indian retail investors have changed their mindset,” Singhvi said. “They are not rushing to exit. They are investing with discipline.”

The SIP AUM rose sharply to around Rs 16.63 lakh crore, accounting for nearly 21 per cent of total mutual fund AUM. Singhvi said SIP money was considered stable, long-term capital and therefore needed close tracking.

During December, around 6.5 lakh new SIP accounts were opened, while about 5.2 lakh were closed. Around 26 lakh new mutual fund folios were added during the month.

The SIP stoppage ratio rose to around 85 per cent in December, compared with 76 per cent in November. Singhvi said the ratio was not alarming as new SIP registrations continued to remain strong. “As long as new SIPs are higher than closures, there is no reason to worry,” he said.

Addressing the key investor question of SIPs versus lump sums, Singhvi said SIPs work better for most long-term investors. “Over the long term, SIP investing delivers better consistency and higher probability of positive returns,” he said.

Singhvi cited data showing that in 2025, around 97 per cent of equity schemes delivered positive returns to SIP investors, despite a prolonged period of market consolidation.

“If an investor does SIP for 15 years and is satisfied with 8 per cent annual returns, there is a 99 per cent chance that money will grow,” he said.

For investors targeting 10 per cent annual returns over 15 years, Singhvi said the probability of wealth creation remained around 95 per cent, provided fund selection was reasonable.

He added that even over shorter periods, such as three years, SIPs offered better odds than many investors assumed. “For three years, if you want 10 per cent returns, SIP still gives nearly a 69 per cent probability,” Singhvi said.

Singhvi said lump-sum investing carried a higher timing risk. “In a lump sum, timing is the biggest risk,” he said. He explained that investors often invest lump-sum money during market highs and exit during corrections, which impacts long-term returns.

“If you understand markets very well and have good advisory support, then a lump sum can work,” Singhvi said. He added that data showed lump sum investments sometimes outperformed SIPs over three to five years, but over longer periods of 10 to 15 years, SIPs generally delivered better outcomes.

“In the long term, SIPs outperform lump sum by 2 per cent or more annually,” he said.

Singhvi said SIPs were best suited for investors with regular income, such as salaried individuals, professionals, and business owners. “SIP builds discipline and removes the need for market timing,” he said.

He added that SIP investors benefit from investing across market cycles, which helps portfolios recover faster after corrections. “SIP portfolios turn profitable faster when markets recover,” Singhvi said.

Summing up, Singhvi said SIPs remained the most practical and stress-free way for long-term wealth creation.