SIP क्यों बंद हो रहे हैं | SIP Stoppage Ratio Increasing | SAGAR SINHA

Summary

The video discusses the growing trend of SIP (Systematic Investment Plan) cancellations in India, focusing on the recent rise in SIP stoppage ratios. Despite the widespread promotion of SIPs as a long-term investment tool, many investors are withdrawing due to short-term market fluctuations and psychological factors like fear and greed. The speaker emphasizes that consistent, long-term investment is key to becoming wealthy through mutual funds. He argues that those who invest regularly, even in a declining market, will see greater returns over time, as opposed to those who react impulsively to short-term losses.

Takeaways

• 😀 SIP stoppage ratio has increased to 88% over the past six months, indicating more people are discontinuing their SIP investments.
• 😀 Despite high media promotion of SIPs, the growth in mutual funds has been inconsistent, with a notable rise in SIP stoppage rates.
• 😀 In 1993, SIPs began in India with an AUM of ₹47,000 crores, but by 2024, it reached ₹68 lakh crores, showing significant growth in the sector.
• 😀 The key reason people may not become millionaires from mutual funds is due to a lack of consistency, with most people discontinuing SIPs during market downturns.
• 😀 SIPs are more beneficial as a long-term investment strategy. Short-term investments in SIPs (less than 2 years) are not ideal.
• 😀 The rise in SIP stoppage ratios highlights that more investors are pulling out, with 79% stoppage in November 2024, the highest in recent months.
• 😀 Direct SIP plans are facing higher stoppages due to the psychological pressure investors face when checking their investments frequently, especially during market declines.
• 😀 Regular SIP plans benefit from having a consultant or agent who can guide investors through tough market periods, reducing the likelihood of premature stoppages.
• 😀 The real returns from SIPs are seen over long periods (e.g., 20-30 years), and early exits or inconsistent contributions prevent investors from maximizing gains.
• 😀 Market timing matters in investing—during periods of market downturns (when the market is red), it’s a better time to invest, as opposed to chasing gains during market highs.
• 😀 Investors often struggle to stay invested during market lows, but those who can remain consistent and committed, despite the market's ups and downs, are more likely to see significant returns in the long run.

Q & A

Why are SIP stoppages increasing in recent months?

SIP stoppages have been increasing due to market volatility, where investors panic when the market is down. Many individuals are stopping their SIPs because they are discouraged by short-term losses and are unable to stay invested for the long term.

What is the SIP stoppage ratio, and why is it significant?

The SIP stoppage ratio refers to the percentage of SIP accounts that are either discontinued or have expired. In recent months, this ratio has reached as high as 88%, which indicates a growing trend of investors abandoning SIPs due to short-term market fluctuations.

How does investor psychology affect SIP investment decisions?

Investor psychology plays a key role in SIP investment decisions. When markets are in a downturn, many investors are driven by fear and stop their SIPs. They often check their investments frequently and, when they see losses, they tend to pull out instead of staying invested for long-term gains.

What is the difference between direct and regular SIP plans?

Direct SIP plans are those where investors manage their investments independently, often through online platforms. Regular SIP plans, on the other hand, involve an intermediary, such as an agent or financial advisor, who helps manage the investment and provides emotional support during market downturns.

Why do direct SIP plans have higher stoppage rates?

Direct SIP plans have higher stoppage rates because investors, who are managing their investments themselves, are more likely to check their portfolios frequently. When they see losses or market downturns, they often panic and stop their SIPs, whereas regular SIP plans offer guidance and reassurance from an advisor.

What role does consistency play in SIP investment success?

Consistency is crucial for SIP investment success. The best returns are often achieved by staying invested during market downturns, as this allows investors to purchase more units at lower prices. Regular contributions and maintaining the investment over time ensure long-term wealth creation.

What is the correct approach to SIP investing during market downturns?

During market downturns, investors should continue their SIPs rather than stopping them. Market corrections present opportunities to buy more units at lower prices, which can lead to higher returns in the long term. The key is to stay invested, even when the market is volatile.

Why is it not advisable to stop SIPs in the short term?

Stopping SIPs in the short term can be detrimental to long-term wealth creation. SIPs are designed for long-term investments, and halting them during a downturn means missing out on the opportunity to buy at lower prices, potentially affecting overall returns.

What impact does market psychology have on individual investment behavior?

Market psychology significantly impacts investment behavior. During market booms, people tend to invest out of greed, and during market slumps, they pull out due to fear. Both actions are driven by emotional responses rather than rational long-term strategies.

Can individuals become wealthy through SIP investments?

Yes, individuals can become wealthy through SIP investments, but only if they stay committed over the long term. The real benefit of SIPs is seen when investors maintain consistency and avoid reacting to short-term market movements. Patience and discipline are the keys to building wealth through SIPs.