Blog Details

What Is The Best Frequency For Equity SIPs?

Investing in mutual funds through Systematic Investment Plans (SIPs) has become a popular choice for many, offering a systematic and disciplined approach to building wealth over time. A SIP gives us an option to choose the frequency of investment among daily, weekly, monthly or quarterly as per our convenience. But does the frequency affect returns in the long term? In this blog, we will try answer this question with the help of data.

                    

The table above shows the returns for a ₹1000 SIP in Nifty 50 TRI for different frequencies like Daily, Weekly, Monthly, Quarterly and Half-Yearly.

Findings

1. The range of 7-year SIP returns is from 14.33 for a daily frequency to 14.77 for a quarterly frequency.

2. The range of 10-year SIP returns is from 13.46 for a half yearly frequency to 13.61 for a quarterly frequency.

3. The range of 12-year SIP returns is from 13.55 for a daily frequency to 13.65 for a quarterly frequency.

4. The range of 15-year SIP returns is from 13.04 for a daily yearly frequency to 13.14 for quarterly frequency.

It can be seen that the difference in the returns across different frequencies is not significant.

Conclusion

Your SIP's frequency won't really matter over a long period of time. In comparison to a simple monthly SIP, a daily or weekly SIP offers no significant benefit. The returns are almost similar across all frequencies. The key is to align your SIP frequency with your income flow, and comfort level. Consistency is more crucial than the specific frequency you choose. Regular investing, regardless of the frequency, helps in building wealth over the long term.