'SIP is not a spend...': Edelweiss Mutual Fund's Radhika Gupta shares wise words on SIPs

Edelweiss Mutual Fund's (MF) chief Radhika Gupta took to X (formerly Twitter) to share her views on systematic investment plans, i.e. SIPs. A Systematic Investment Plan (SIP) is a method provided by mutual funds for investors to invest money regularly and consistently in a disciplined manner. 

Gupta, who has been advocating on systematic and regular investing, said: "First Mercedes then medicines. Everyone’s worried about being beaten by SIPs. But small correction — SIP is not a spend, but an investment in the future. Keep investing India."
She added: "India's "monthly spend" on SIPs beat their spend on medicines in March 2024" and asked readers to "keep investing".

The post indicated that Systematic Investment Plan (SIP) contributions on a monthly basis were consistently lower than the sales of domestic pharmaceutical products. Gupta's statement came as a response to a user's post that pointed out India's monthly expenditure on SIPs had exceeded its monthly spending on medicines back in March 2024.

Before March 2024, Indian consumers were allocating more funds toward pharmaceutical purchases every month than towards investing in financial security through SIPs.

SIPs have become a favoured option among retail investors who aim to accumulate wealth over an extended period. These investment plans have advanced significantly, now providing a range of investment frequencies including monthly, weekly, and daily options.

In August, the Systematic Investment Plan (SIP) contributions, according to data from the Association of Mutual Funds in India (AMFI), achieved a record high. The gross SIP inflows amounted to Rs 23,547 crore, surpassing the previous month's figure of Rs 23,331 crore. Furthermore, the SIP assets under management (AUM) peaked at Rs 13.39 lakh crore, showing an increase from Rs 13.09 lakh crore in July. This upward trend signifies a strong investor interest and a rising trust in SIPs as a favored investment vehicle.

In August, the number of Systematic Investment Plan (SIP) accounts rose to 9.61 crore, marking a significant increase from the 9.34 crore accounts reported in July. This uptrend illustrates the expanding involvement of investors in SIPs. Furthermore, during this month, 18 fresh open-ended schemes were launched, accumulating a total of Rs 13,815 crore in funds.