SIP or Lumpsum- Long term Pov

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billubakra

Dear Senior investors,

Does sip or lumpsum make much of a difference in the long run 8-15 years? How do you invest lumpsum amounts in funds and stocks?

@drjpatwa @Sudarshan61

@MrKool_JJ @guest_999 Please tag other long term investors here.

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guest_999 wrote:

From whatever I know, no it does not make a difference over a period of 10 years+. Lumpsum amount is to be invested depending upon the market condition at that time.
@bikidas2060 @Awake @BubbleBoyChickenLittle @malikcool @marketdimer

Any blog or thread in which the writer has proved it with examples etc? Or someone who has written it with his/her experience?

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Yes…timing makes all the difference.
Eg. Person doing lump-sum during March 2020 will surely have better returns in short/long run…as compared to someone doing lumpsum when sensex is at 50K or someone who is doing SIP since last one year.

That’s the reason most suggest to go via SIP ..but no harm in going lump-sum when markets crack

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Sudarshan61 wrote:

Yes…timing makes all the difference.
Eg. Person doing lump-sum during March 2020 will surely have better returns in short/long run…as compared to someone doing lumpsum when sensex is at 50K or someone who is doing SIP since last one year.

That’s the reason most suggest to go via SIP ..but no harm in going lump-sum when markets crack

But is there any detailed article about the same?
This one says otherwise https://freefincal.com/lump-sum-vs-sip-inve...g/

Hunk Hunk
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billubakra wrote:

But is there any detailed article about the same?
This one says otherwise https://freefincal.com/lump-sum-vs-sip-inve...g/

Timing is everything. It makes the difference among us and damani, Jhunjhunwala type people. Everyone has his/her opinion.
Timing is everything, but my 100₹ becomes 200₹ n you did sip n after investing 100000₹ you getting 10% returns. So, who won? Percentage wise me, net gain wise you.
Timing is important, risk taking ability is important. Anything worthwhile doesn’t come cheap.

Critic Critic
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billubakra wrote:

But is there any detailed article about the same?
This one says otherwise https://freefincal.com/lump-sum-vs-sip-inve...g/

From that same link:

The point is, that we cannot foretell and therefore do not know whether a lump sum is better or a SIP/STP. It is only in hindsight that we can know and is not of much use.

So in short, keep doing sip & leave investing lumpsum(some expected/unexpected bonus etc) to your luck(maybe market is down at the time you get lumpsum so good to invest then but if market is high when you get lumpsum then just park it in some savings acc with good interest rate/liquid fund for few weeks/months until market corrects).

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guest_999 wrote:

From that same link:

The point is, that we cannot foretell and therefore do not know whether a lump sum is better or a SIP/STP. It is only in hindsight that we can know and is not of much use.

So in short, keep doing sip & leave investing lumpsum(some expected/unexpected bonus etc) to your luck(maybe market is down at the time you get lumpsum so good to invest then but if market is high when you get lumpsum then just park it in some savings acc with good interest rate/liquid fund for few weeks/months until market corrects).

I get it bro but wanted to know how much is the return difference between the two in the long run. Kuvera’s founder Gaurav Rastogi wrote some article about it with data some time back. Lost link of the same. + @bikidas2060

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billubakra wrote:

I get it bro but wanted to know how much is the return difference between the two in the long run. Kuvera’s founder Gaurav Rastogi wrote some article about it with data some time back. Lost link of the same. + @bikidas2060

Huge return differences, mine 100%, your 10%.
Btw, this is your link https://kuvera.in/blog/to-lump-sum-or-to-stp-is...

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billubakra wrote:

It was an article between sip and lumpsum only. He, with some other author, compared many funds and it was posted on that author’s blog.
About return difference, I was talking about long term pov.

Return difference will be huge. You managed to put money in mf in every fall n you have to see better results than SIP wale.
Most SIP wale ll get from 10.5-11% CAGR every year if they stay in the market for long term. SIP has its own limitation.
Since we keep on buying during both high n lows, returns will be averaged n eventually become lackluster. But 10.5-11% CAGR every year is good.

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bikidas2060 wrote:

Return difference will be huge. You managed to put money in mf in every fall n you have to see better results than SIP wale.
Most SIP wale ll get from 10.5-11% CAGR every year if they stay in the market for long term. SIP has its own limitation.
Since we keep on buying during both high n lows, returns will be averaged n eventually become lackluster. But 10.5-11% CAGR every year is good.

If he knows how to enter & exit correctly then why would he invest in MFs in the first place, wouldn’t investing directly in niftybees would be better. smile
@Awake

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guest_999 wrote:

If he knows how to enter & exit correctly then why would he invest in MFs in the first place, wouldn’t investing directly in niftybees would be better. smile

ji

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guest_999 wrote:

If he knows how to enter & exit correctly then why would he invest in MFs in the first place, wouldn’t investing directly in niftybees would be better. smile
@Awake

And more better would be to invest directly in stocks. If one knows when to enter/exit. smile

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bikidas2060 wrote:

Return difference will be huge. You managed to put money in mf in every fall n you have to see better results than SIP wale.
Most SIP wale ll get from 10.5-11% CAGR every year if they stay in the market for long term. SIP has its own limitation.
Since we keep on buying during both high n lows, returns will be averaged n eventually become lackluster. But 10.5-11% CAGR every year is good.

Why did you mention CAGR and not XIRR?

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I won’t suggest you to invest your money at one go.

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Yes always matter. Those who are shouting that they faced losses in Mutual Fund, majority of them will be lumpsum buyer at pick.

& about 8-15 years, everyone talks about long term investment. But recent data shows only 7% SIP is invested for more than 5 years. That much we all are impatience…

@billubakra

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drjpatwa wrote:

Yes always matter. Those who are shouting that they faced losses in Mutual Fund, majority of them will be lumpsum buyer at pick.

& about 8-15 years, everyone talks about long term investment. But recent data shows only 7% SIP is invested for more than 5 years. That much we all are impatience…

@billubakra

Patwa saab any in depth comparison article/thread for both with extensive data?

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billubakra wrote:

Patwa saab any in depth comparison article/thread for both with extensive data?

Bhai itne calculators hai such as Etmoney. Koi saabhi lele. N backtest the data

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Its always good to invest through SIP and add the lumpsum amount when market is down, then only there is possibility to get best returns with over long period of investment.

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billubakra wrote:

Time and expertise.

pura ready-made chiz chahiye. Bhai way pata chal gaya, aim bhi hai, gaadi bhi mil gayi, uske baad khud thoda shram karo. Just a suggestion only

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bikidas2060 wrote:

pura ready-made chiz chahiye. Bhai way pata chal gaya, aim bhi hai, gaadi bhi mil gayi, uske baad khud thoda shram karo. Just a suggestion only

Bhai way pata chal gaya, aim bhi hai, gaadi bhi mil gayi, uske baad khud thoda shram karo.
Why isn’t everyone a Buffett then in this field? All secrets are known to everyone.

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billubakra wrote:

Bhai way pata chal gaya, aim bhi hai, gaadi bhi mil gayi, uske baad khud thoda shram karo.
Why isn’t everyone a Buffett then in this field? All secrets are known to everyone.

Nobody wants to put ,Shram aka efforts. We might not become Buffet, we will become something.

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billubakra wrote:

Patwa saab any in depth comparison article/thread for both with extensive data?

Such comparison can’t be done as research point of view because which date to take for lumpsum investment to compare? (Research can be manipulated in such cases according to wish of researcher. If he takes low point of entry in lumpsum then lumpsum is better. If he takes high point in lumsum then lumpsum is poor !!)

Just take a example, someone bought mutual fund in March low will be getting 80% return in currently. But if compare with last year’s high it is just 20%

So timing is very important in Lumpsum & no one can time the market.

I don’t know purpose of ur question. If u have large amount & wondering to invest in SIP or lumpsum then put that in Good debt fund & then do STP for 2-3 years time frame. If market falls in between, Stop STP & do switch entire amount to equity. It’s simple….

@billubakra

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bikidas2060 wrote:

Nobody wants to put ,Shram aka efforts. We might not become Buffet, we will become something.

Will put the shram. But there was no point to dodge the question.

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billubakra wrote:

Will put the shram. But there was no point to dodge the question.

New question is why people have not become like Buffet. 1) they did not put hardwork 2) they searched for tips 3) lack of patience 4) they are unlucky

Old question, you got the app, you know what to type. If I start calculating then I’ll have to consider various factors such top mutual funds, SIP starting from high market condition, sip starting from low market condition, same with lumpsum thing. That’s a lot of work. People like me go the stock way. During 2015-16, I used to do such calculation.

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