Side-by-side wealth projection for lump sum vs monthly SIP investing. Find which strategy builds more corpus for your goal.
Lump sum investing works best when you have a windfall and markets are at or near a correction. SIP is better when you have a regular monthly income and want to average out market volatility through rupee cost averaging. For most salaried Indians, SIP is the default — but if you receive a bonus or inheritance, lump sum can generate more wealth in a rising market.
In consistently rising markets (like bull runs), lump sum outperforms SIP because all money is deployed immediately. In volatile or falling markets, SIP wins through rupee cost averaging — buying more units when prices are low. Historically over 20+ years, lump sum in a diversified index fund tends to outperform SIP, but timing risk is higher.
STP is a hybrid: invest your lump sum in a liquid/debt fund, then automatically transfer a fixed amount to equity each month — combining the lump sum tax efficiency with SIP's rupee cost averaging. It's a popular strategy for deploying large windfalls into equity systematically.
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