The power of consistency: Why stopping SIPs during market volatility could hurt your long-term portfolio – News Air Insight

American author and motivational speaker Jim Rohn once said, “Discipline is the bridge between goals and accomplishments.” This saying is truly apt for the world of investments, where discipline is critical when it comes to long-term wealth creation. Monthly investments through SIPs have surged 3.8 times over the past five years from Rs 7,788 crore in September 2020 to Rs 29,361 crore in September 2025, which is an encouraging trend.

One of the primary benefits of SIPs is that it helps investors inculcate discipline and overcome their behavioural biases. A typical investor mindset is driven by various types of emotions such as fear or excitement, leading them to invest more when the markets rise and reduce or avoid investing when the market falls. This is also evident from the equity mutual fund inflows data. For example, when the market was hitting new highs in the first half of FY 2024-25, lump sum inflows in equity funds rose sharply. However, as the market started correcting, the gross equity fund inflows dropped substantially towards the last quarter of FY 2024-25 and the beginning of FY 2025-26 (refer chart below).

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Data source: AMFI. Gross equity inflow ex SIP is estimated assuming 80% of the overall SIP flows are in equity funds. SIP inflows shown above are across all fund categories.

On the other hand, SIP inflows have witnessed steady growth, which demonstrates that investing via SIPs is a great way to overcome behavioural biases. With regular investments through SIPs, investors benefit from rupee cost averaging and do not have to worry about market levels or valuations. It is important not to try to time the market as it can often prove counterproductive, due to investors’ behavioural biases.

The challenge for patient investors

The past year has been relatively difficult for most equity mutual fund investors due to the dismal market performance, resulting in almost no upside. These are the times when the patience and discipline of investors are tested since it is not easy to continue investing with conviction in such an environment.To make things worse, some market participants have been expressing concerns about mutual fund investors continuing to invest in equities via SIPs, despite higher market valuations. While investors have shown great patience so far, it may be difficult to ignore such noise, especially if they are relatively new investors.

Should SIP investors really worry about the current market environment?

To be a successful investor, one needs to maintain investment discipline and prevent behavioural biases from influencing their decisions to enter or exit an investment. Theoretically, it may seem ideal to stop SIPs when market valuations are expensive and resume when valuations are cheap. However, it is not so easy to practise, especially if you are not a professional investor because:

A. Assessment of valuations tends to be subjective as they need to be seen in conjunction with the growth outlook and other macro and micro factors,
B. It is difficult to decide when exactly to resume the SIP once stopped, and
C. Historical data suggests that investors’ decisions are largely influenced by behavioural biases rather than rational thinking.

Moreover, stopping SIPs could lead to a break in the investing journey, potentially interrupting the compounding process. So, keep SIPping and don’t let the noise drown your patience.

(The author is Head of Investment Products, Share.Market (PhonePe Wealth)