According to a historical study by WhiteOak Capital AMC, a SIP that has fetched low returns in the first five years has delivered more favourable returns over ten years. Comparatively, whenever the average SIP return exceeded 8% in its first five years, the final SIP return after ten years averaged 14.9%.So, the next time your SIP falters in its early years, give it the benefit of a longer horizon. This principle also helps the SIP investor recover from a bear market much faster. SIP investors clearly need to embrace short-term volatility rather than get bogged down. It’s best to run a SIP like a marathon, finds a study by Edelweiss Mutual Fund.

Source: Economic Times July 31, 2023 17:32 UTC