How A Best SIP Plan For Long Term Can Actually Help In Falling Markets?

Published: 2025-06-03
Views: 4
Author: acefinancial
Published in: Finance

Feeling worried when markets fall? You're not alone.

Most investors feel nervous when they hear the market is down. It’s completely natural to worry about your money, especially when you’ve worked hard for it. But here’s something that might surprise you, falling markets can be good for your SIP investments. Yes, you read that right! The best mutual fund distributor in Kolkata can help you start a SIP even in the market fall, so you can turn market dips into smart opportunities.

In this article, we’ll help you understand how SIPs work in your favour during tough market conditions. Whether you are a first-time investor or someone looking for long-term goals, this article is your simple guide to understanding how SIP works in market dips.

Why SIPs Are a Great Choice?

Before we talk about falling markets, let’s quickly look at what a SIP does.

A Systematic Investment Plan (SIP) allows you to invest a fixed amount in a mutual fund regularly, usually monthly. It encourages discipline and you don't even have to time the market for this.

But the real magic happens when the market goes down.

Here's How Falling Markets Benefit SIP Investors:

✅ You Buy More Units at a Lower Price:

This is called rupee cost averaging. When the market is down, the NAV (Net Asset Value) of mutual funds drops. Your SIP amount stays the same, so you get more units. When the market recovers later, those extra units are worth more, leading to potentially higher returns.

✅ Compounding Works Even Better:

The longer you keep invested, the more your corpus will grow, that's the power of compounding. When you continue SIPs through a market fall, your investments have more time and better chances to multiply as the market rebounds.

✅ It Keeps You Emotionally Balanced:

During market dips, many people panic and stop investing. SIPs protect you from emotional decisions. Since your investment happens automatically every month, you stay on track.

Real-Life Example:

If you invest ₹10,000 per month in a mutual fund through SIP. In a falling market, the NAV is lower, so you buy more units. A few years later, the market recovers, and those cheap units grow in value. That’s why the best SIP plan for long term in Kolkata isn’t just about choosing the right mutual fund, it’s also about sticking to your plan even during the hard times.

Why Falling Markets Should Not Scare You

Here’s a quick reality check — markets always bounce back.

The 2008 crash? Followed by record highs. COVID-19 market fall in 2020? Recovered within months.

Investors who stayed invested during those times made excellent returns. So, the next time you see the market falling, remind yourself, this is a good thing for your SIP.

Key Benefits of SIP During Market Dips

• No need to time the market

• Lower average cost per unit

• More units are purchased when prices drop

• Better returns over the long run

• Automatic investment = Less stress

What Should Beginners Remember?

If you’re new to investing, don’t worry. SIPs are one of the easiest and safest ways to get started. Here are some quick tips:

• Start with a small amount.

• Stay consistent, even when the market seems scary.

• Focus on long-term goals.

• Don’t stop your SIP during downturns, that’s when the real benefit happens.

Conclusion

Yes, market downturns can feel overwhelming. But remember, they’re temporary. The long-term trend of markets is upward. And SIPs are designed to ride out these ups and downs for you. When you continue investing through a falling market, you’re not losing, you’re buying future gains at a discount.