SIP or Lumpsum which is best?


Let's say I can invest Rs.12000 a year. Shall I go for Rs.1000 every month SIP or 12000 every year as a Lumpsum?

Please suggest.

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Hi , most people say to invest in SIP. I did it earlier, not a bad idea !!! It works when you invest for 2 to 3 years. If your span is of more than this just go for mix of both in 40: 60 ratio with SIP and Lump-sum respectively. As we find more good opportunities when market crashes and they are eminent two to three times a year, I prefer to invest 40% by SIp and rest while market crashes. This reaps better than SIP. SIP is good for brokers, I mean by suggesting you to go for SIP , they can get good commissions. I see from that angle.

I prefer SIP because as a normal investor, market timing is something I cannot predict. Going the SIP route keeps you constantly invested throughout market phases. This way you eliminate market timing completely. Of course, this view works in the long run but can also be applicable in the short term horizon especially when your view of the market direction is not crystal clear.

And SIP doesn't need to happen through advisors. You can do it yourself by initiating an SIP directly with the MF house. Also you can with most funds, invest regularly yourself without committing to an SIP. No fees and commissions there! :)


Active Member
SIP is invested on a standard date every month. This is done irrespective of the market conditions, whether market is up or down. Instead keep aside the amount you wish to invest under SIP. In a particular month, if market is down by more than 100 or 200 points, the next day NAV of the scheme will naturally be down. You invest on that day.

Otherwise SIP is beneficial for those who don't have discipline in saving / who forget to invest / who could not invest regularly due to various reasons / who are lazy.