Systematic Investment Plans (SIPs) are fundamentally designed for long-term wealth creation rather than attempting to outperform the market annually, according to Radhika Gupta, MD and CEO of Edelweiss Mutual Fund. Gupta articulated this perspective during an appearance on "The Alpha Bets by Groww," advocating for a disciplined investment approach that prioritizes consistency over short-term gains.
Record Inflows Highlight SIP Popularity
The appeal of SIPs continues to grow among retail investors, with record inflows underscoring a shift towards structured, long-term investing. Data from the Association of Mutual Funds in India (AMFI) reveals that investors contributed a substantial ₹31,781 crore through SIPs in June 2026 alone. This robust activity brought the cumulative SIP collections for the first quarter of FY27 to ₹93,850 crore.
Despite ongoing market volatility, the steady increase in SIP investments reinforces their role as a preferred wealth creation strategy for many households. Gupta highlighted that the primary objective of investing via SIPs is not to achieve immediate market-beating returns, but rather to remain invested for a sufficient duration, allowing the power of compounding to work its magic.
Why Mutual Funds for Beginners?
Gupta recommends that individuals embarking on their investment journey, especially those busy with career development, should opt for diversified actively managed mutual funds or broad-based index funds. She argues that most beginners lack the time, expertise, or resources required to conduct in-depth company research, analyze financial statements, or continuously monitor market fluctuations necessary for effective stock picking.
"For most beginners, the first investment in equities should ideally be through a mutual fund," Gupta stated, underscoring the simplicity and diversification benefits these instruments offer.
Echoing her professional advice, Gupta revealed her personal investment philosophy: she has initiated a SIP for her newborn son in a large and mid-cap index fund. This personal commitment demonstrates her conviction in disciplined investing as the cornerstone of wealth creation, rather than chasing fleeting high returns.
The Power of Disciplined Saving
Beyond investment vehicles, Gupta advises cultivating a strong habit of saving, treating it as a non-negotiable monthly expense akin to taxes. This approach helps investors maintain consistency in their contributions, even during periods of market uncertainty or personal financial strain. SIPs facilitate this discipline by automating regular investments, typically a fixed amount each month, directly from an investor's bank account.
The growing popularity of SIPs is also attributed to the principle of rupee cost averaging. This mechanism allows investors to acquire more units when market prices are low and fewer units when prices are high, effectively mitigating the impact of short-term market volatility and removing the psychological pressure of timing the market perfectly.
SIP Participation Continues to Surge
AMFI statistics further illustrate the expanding reach of SIPs across India. By the end of June 2026, the total number of outstanding SIP accounts reached an impressive 1,051.59 lakh. The month alone saw 55.51 lakh new SIPs registered, with 978.30 lakh accounts actively contributing to monthly inflows. The industry's SIP assets under management (AUM) have climbed to ₹17.70 lakh crore.
This growth trajectory is significant, with monthly SIP collections soaring from ₹3,122 crore in April 2016 to over ₹31,000 crore in both April and June 2026, reflecting a substantial increase in retail participation in equity mutual funds. Gupta's core message remains clear: consistent investment in diversified mutual funds through SIPs, sustained across various market cycles, provides the essential time for compounding to build substantial long-term wealth.