r/IndiaInvestments
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  • Introduction
  • Disclaimers and Disclosures
  • FAQs
    • FAQs
    • Mutual Funds and ETFs
      • What is the best mutual fund app for investments?
      • Why should I invest in Direct Plans instead of Regular Plans?
      • What’s the best mutual fund I can invest in?
      • Which date(s) is/are best for SIP in a month?
      • I’ve to invest in ELSS for 80C tax saving. Which fund(s) should I pick?
      • Should I get a Demat Account to buy units in Mutual Funds?
      • Lumpsum investment vs SIP/DCA
      • Why are Index Funds in India not as cheap as Vanguard's Index Funds and ETFs?
    • Insurance
      • Should I invest in this LIC policy?
      • Opinions on investing in smart wealth plan by bank?
      • Up to what age should I take term cover?
      • Do I need my own health insurance? Employer already has group policy
      • Should I take top-up policy or super top-up?
      • Is it worth paying extra premium for term insurance?
    • Stocks
      • Should I invest in smallcase?
      • What is the best app for buying or trading stocks?
      • Which screener(s) should I use?
      • The Stock Market Has Crashed. Which Stocks Should I Buy?
    • Foreign Investing
      • Why should I invest in the US markets?
      • How should I invest in US equity?
    • Tax
      • I don't have any tax to pay. Do I still have to file ITR?
    • Miscellaneous
      • Where can I park money for a few days, a few months, or a few years?
      • What are chit funds? Should I invest?
      • Is Gold a good investment now? It has gone up ~50% this year
  • How To
    • How To
    • How to transfer shares from one demat account to another
    • How to move from one mutual fund platform to another
    • How to switch a Mutual Fund from Regular to Direct Plan
    • How to file SEBI SCORES complaint?
    • How to Update Nominee Details?
    • How to rematerialize mutual fund from demat form
    • How to Pay Advance Tax
  • STOCKS
    • Introduction to the Stocks Series
    • Can You Beat the Market?
    • Reading an Annual Report
    • Researching a Sector
    • Financial Metrics and Ratios
      • Profitability
    • Using Screeners
    • Due-Diligence Checklist
    • Work in Progress
      • Diving Deeper into Businesses
      • Efficiency
      • Liquidity and Solvency
  • EXCEL
    • Excel for Fun and Profit
    • Reactive UI & Updates
    • Using External Data : Google Finance
    • Using External Data : Working with CSV Format
      • CSV Format
      • Computing LTCG Eligible Equity Units
      • Process for Estimating Tax
    • Quantifying Returns: CAGR and XIRR
      • CAGR: Point-to-Point Annualized Returns
      • A Gentle Introduction to XIRR
      • A Rigorous Introduction to XIRR
  • BONDS
    • Bond Basics
    • Government Securities
    • Corporate Bonds
  • MISCELLANEOUS
    • Miscellaneous
    • US Investing
    • Recommended Reading
  • New to Investing
    • Zero to Investing
      • Getting Started
      • Part Two - Defensive Setup
      • Part Three - Spending Pattern
      • Part Four - How to Invest
    • Investment Philosophy and Strategy
      • Basics of Investment Strategy Plan
      • A simple Financial Planning Roadmap
      • Various types of Risks in Investments
      • Are you a Stock or Bond?
      • Assets and Asset Allocation
      • Critical Mass
      • Asset Rebalancing
      • Lumpsum or SIP/STP
    • Insurance
      • Life
        • Life Insurance: What it is exactly?
        • How to Evaluate Life Insurance Needs
        • ULIP - Unit Linked Insurance Plan
        • Some FAQs on Life Insurance
        • Links to Answers related to Life Insurance
      • Health
      • Others: Disability / Home
      • Child Plan
    • All About Mutual Funds
      • What is a Mutual Fund?
      • Types of Mutual Funds
      • What and Why of Mutual Fund Ratings
      • How to Select a Mutual Fund
      • FAQs for Mutual Funds
      • SIP and Mandates
      • How to Become Crorepati using Mutual Funds
      • Analysis using long term equity and debt funds in India
    • Retirement
      • Primer on Retirement Planning
      • Why You should not Opt for a Readymade Pension Plan
      • Studies of Long Term Portfolios and Retirement Withdrawal Rate Suggestions
      • Do-It-Yourself Retirement Plan
    • Personal Finance
    • Behavioral Biases
    • ELI5 Series
      • Time Value of Money
      • Inflation
      • Life Insurance
      • ELI5 guide to Selecting an Equity Mutual Fund
      • How do I start investing in mutual funds [ELI5 series]
      • Mis-selling of Insurance Products
  • BEGINNER'S GUIDE TO INVESTING
    • Zero To Investing
      • The First Step - Emergency Fund
      • The Final Step - Mutual Funds
  • Contributors Section
    • How Can I Start Contributing?
    • What is a Contributor License Agreement and why are we using it?
      • Contributor License Agreement
    • How to link FAQ via bot in Discord
    • Style Guides
      • General Style Guide
      • FAQ Style Guide
      • How To Style Guide
      • Excel Series Style Guide
      • Stocks Style Guide
  • Discord and Reddit
    • How to Search the Wiki From Discord
    • I'm unable to send messages to stocks-fundamentals channel on Discord. Why?
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  1. FAQs
  2. Mutual Funds and ETFs

Which date(s) is/are best for SIP in a month?

There's no such thing. It's rare for markets to move up / down so much in a single month, that a single SIP instalment being on a different date would make a sizeable difference in your long term.

There's no such thing.

It's rare for markets to move up / down so much in a single month, that a single SIP instalment being on a different date would make a sizeable difference in your long term corpus.

If you start investing today via SIP, and analyse 10 years later, you'd find that, say for example, 23rd of the month was the best day to invest for your funds. That's something you can know only if you know the NAV history of next 10 years, which no one does.

What about the apps that show you best date of SIP?

These platforms or services are showing you, the "best" date, to prevent an analysis-paralysis. It's "one less thing to worry about", therefore prompting it to the user would mean higher conversion rate (assuming this is a metric these platforms are measuring - how many people complete setting up their SIPs).

This is good for the platform, as it's helping the user feel psychologically safe that they're able to see some analysis, no matter how useless it is.

However, the only thing they've done is take past NAV data, and found out what has been best date of SIP for a particular fund over a period.

Since past performance is not indicative of future performance, anything derived from past performance is also not indicative of same metric for future.

If between 2001-2010, 5th of the month had been best for a particular fund, say SBI Bluechip (not a recommendation, just using as an example) - that does NOT mean for next 10 years (2011-2020) same exact date was best for the same fund.

For instance, some people believe that the last Thursday of the month coinciding with options expiry date, can be best for investment. This is obviously not backed by any sound analysis.

What does a sound analysis here look like?

You might find articles on the internet that draws some conclusions.

Take the 2010-2020 period. It's a 10 year period, with 120 months. That's 120 transactions. Assuming each month to be of 28 days (to account for February); this would require comparing across 28 time-series data sets, with each having 120 entries; for every fund.

But that's not all! Imagine someone investing on 28th of a month, instead of 1st of a month after salary credit (assume this person gets paid by employer on last day of previous month). Then these 28 days, this amount has been parked in savings account or overnight fund or even short term FD.

A proper analysis on best date for SIP would also have to involve the interest income from this and tax paid on these gains, which again, have varied greatly over any meaningful period.

As you can see, there are too many variables; and that's just with one single fund. India has more than a two thousand mutual funds, as of now.

Finally, consider that people don't invest the same amount via SIP over a ten year period. Some people increase the amount of SIP that they do every year as their salary increases. Some of them pause their SIPs from time to time, or skip a few installments here and there.

To sum it all up; there might be a best date for SIP in a month, and it depends on lot of factors that one cannot easily simulate with past data. But even if they did and found one, that date might not be best for your investment pattern for next 1-2 decades.

Invest on a date of month you're comfortable with.

PreviousWhat’s the best mutual fund I can invest in?NextI’ve to invest in ELSS for 80C tax saving. Which fund(s) should I pick?

Last updated 3 years ago

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