Does timing matter? Investing ₹10,000 SIP - peak or bottom, Who Got Richer?

Constantly switching to the "best-performing index" every year doesn't beat the simple discipline of sticking with one strategy

Over the last decade, Systematic Investment Plans (SIPs) have quietly transformed the way Indians invest. What was once a little-understood mutual fund feature has now become a household financial strategy. In fact, data from AMFI shows that monthly SIP contributions have seen a massive surge in the past ten years, making them one of the most trusted wealth-building tools for retail investors.

 

But with this growing popularity comes a flood of questions. Should I start my SIP now, or wait for the market to correct? What’s the ideal time horizon? What if I invest at the market peak? Can SIPs really give consistent returns? 

 

 

To answer these questions, WhiteOak Capital Mutual Fund conducted a detailed study, analyzing long-term data from market indices such as the BSE SENSEX TRI over nearly three decades. The results offer valuable insights into how SIPs behave across different market cycles and what investors should keep in mind.

 

Why SIPs Work: A Quick Refresher

 

A Systematic Investment Plan is simply a way of investing a fixed amount regularly (monthly, quarterly, etc.) into a mutual fund scheme. Instead of trying to time the market, SIPs harness:

 

Rupee Cost Averaging – You buy more units when prices are low and fewer when prices are high, averaging your cost over time.

 

Power of Compounding – Even small monthly investments grow substantially when compounded over decades.

 

Discipline – Investing becomes a habit, not a one-time decision based on market moods.

 

But the real question is—how long should you stay invested, and does timing matter? Let’s find out.

 

Q1: What Is the Ideal Time Horizon for SIPs?

 

We often hear advice like “Invest for the long-term,” but what exactly does that mean? Is five years enough? Or should you stay invested for ten, fifteen, or even twenty years?

 

The study reveals a clear pattern: the longer your SIP horizon, the higher your probability of earning positive and stable returns.

 

Here’s a snapshot of the findings (based on BSE Sensex TRI data from August 1996 to August 2025): 

Above returns are %XIRR Rolling Returns on monthly basis for BSE SENSEX TRI for SIP between August 1996 to August 2025.

 

Key takeaways:

 

In shorter time frames (3–5 years), returns can swing wildly—sometimes even negative.

 

At 8 years and beyond, the risk of loss almost disappears.

 

Over 10+ years, SIPs have historically delivered double-digit returns with 95–100% consistency.

 

 Lesson for investors: Treat SIPs like a long-term commitment—at least 8–10 years—to ride out volatility and benefit from compounding.

 

Q2: Is It Better to Start SIPs at Market Tops or Bottoms?

 

This is the million-dollar question most investors worry about. What if I start my SIP at the peak of the market and it crashes soon after? Should I wait for the “right time”?

 

The study compared two scenarios:

 

Starting SIPs at the peak of market cycles.

 

Starting SIPs at the bottom of market cycles.

 

Here’s what they found:

 

Returns are slightly higher if you start at the bottom, but the difference narrows significantly over long horizons.

 

Wealth creation is actually higher for those who started at the top, simply because they stayed invested longer.

 

The cost of delay is huge—waiting for the perfect moment often means missing out on years of compounding.

 

For example:

 

An investor who started a ₹10,000 SIP in Jan 2008 (market peak) would have invested ₹21.2 lakh till Aug 2025, now worth ₹75.23 lakh (XIRR 12.96%).

 

Another who waited and started in Mar 2009 (market bottom) invested less—₹19.8 lakh—and ended up with only ₹64.44 lakh (XIRR 13.05%).

 

The difference in returns is marginal, but the investor who started earlier created ₹10.79 lakh more wealth.

 

 Lesson for investors: Don’t wait for the “perfect” time. The best time to start SIPs is as soon as possible.

 

Why Missing SIPs Is Riskier Than Market Crashes

 

The report makes a bold but important statement: The biggest risk is not the market—it’s missing out on compounding.

 

Think about it:

 

Markets may rise and fall, but over decades, the upward trend dominates.

 

Investors who stop or delay SIPs lose precious time, which is impossible to recover.

 

If you skip investing during downturns out of fear, you also miss the chance to accumulate more units at cheaper prices—ironically the best time to invest. 

A 28+ year analysis of SIP (Systematic Investment Plan) returns in the BSE Sensex shows that even during volatile periods and sharp market corrections, disciplined investors who stayed invested saw their money grow meaningfully. 

The table below is the investment summary of two investors, one who started a Rs. 10,000 monthly SIP at the Top of various market cycles and the other at the Bottom: 

Suppose an investor started a monthly SIP of ₹10,000 in BSE SENSEX TRI in January 2008 (market peak of cycle six):

 

Total invested: ₹21.20 lakh

 

Current value (as of 31-Aug-2025): ₹75.23 lakh

 

XIRR (annualised return): 12.96%

 

Another investor started the same ₹10,000 SIP in March 2009 (market bottom of cycle six):

 

Total invested: ₹19.80 lakh (₹1.40 lakh less invested)

 

Current value (as of 31-Aug-2025): ₹64.44 lakh (₹10.79 lakh less than the earlier investor)

 

XIRR (annualised return): 13.05%

 

Takeaway:

Starting SIPs at a market peak vs. market bottom made only a small difference in XIRR (12.96% vs. 13.05%). What truly mattered was staying invested for the long term — both investors multiplied their wealth significantly.  For instance, despite multiple corrections — from the dot-com crash in the early 2000s, to the global financial crisis in 2008, to the Covid-19 pandemic in 2020 — SIP investors still generated long-term annualised returns of around 13–14% (XIRR). That means even someone who started small and kept investing regularly ended up with significant wealth over two decades.  

The data also answers some of the most common investor doubts:

 

Should I time my SIPs?

The numbers show that it’s nearly impossible to pick the best day every month. Missing out often costs more than staying consistent. 

 

Which is better – Large Cap, Mid Cap, or Small Cap SIPs?”

Large Caps provide stability, but Mid Caps delivered some of the best long-term returns, with higher chances of generating double-digit growth. Small Caps were more volatile, but also offered strong upside in good years. 

The study reveals that, among the three market cap segments, Mid Cap Segment was a good investment option for investors seeking to invest via the long-term SIP route.

   

What’s the best SIP date?

The data reveals no major difference in long-term returns between dates. The best date is simply the day you have money available — like your salary credit day.

 

What about SIP frequency?

Daily, weekly, or monthly SIPs ended up delivering almost identical long-term returns. The important thing is to start early and stay invested. 

% XIRR for BSE SENSEX TRI for SIP between August 1996 to August 2025. SIP installment amounts are selected in such a way, so that the total investment remains the same in all the three frequencies for better comparison. Assuming SIPs at the start of

 

“Should I stop SIPs when markets are falling?”

Quite the opposite! Historical data shows that SIPs starting in bad times often rewarded investors with better long-term returns. Corrections are opportunities, not reasons to stop.

 

What if my income grows?

That’s where SIP Top-ups come in. By gradually increasing your SIP contributions, you can reach your financial goals faster and even retire earlier. 

Reach Goals Faster: With a SIP Top-up, investors can periodically increase their monthly installment, helping them achieve long-term goals (like retirement) much earlier.

 

Start Small, Grow Big: Allows investors to begin with a smaller SIP amount and gradually increase it as their income rises—ideal for young earners with limited surplus money today but higher salary growth in the future.

 

Retire Early: By boosting contributions over time, investors can accumulate their retirement corpus faster and plan for early financial freedom.

 

Disciplined Investing 2.0: SIP Top-up extends the discipline of regular investing into future income growth, ensuring extra surplus is automatically invested without second-guessing each year.

 

Stress-Free Planning: By committing in advance to invest more in the future, investors remove the burden of deciding how to allocate additional money later.

 

Normal SIP v/s Fixed SIP Top-Up v/s Variable SIP Top-up in BSE SENSEX TRI (SIP ending value as on 31-Aug-2025)