SIP vs Lump Sum Investment

AARUSHI SHASHANK MERCHANT

doi:10.71097/IJSAT.v16.i4.8897

SIP vs Lump Sum Investment

Author(s)	Ms. AARUSHI SHASHANK MERCHANT
Country	India
Abstract	This research is aimed at analyzing the efficiency of Systematic Investment Plans (SIPs) and Lump Sum investments as a tool in risk management and wealth generation in the dynamic capital market, especially in the Indian equity market. Whereas SIPs focus on disciplined and frequent investment with the benefit of rupee-cost averaging, lump sum investments allow greater potential returns in case they are invested at opportune times but also subject the investor to concentrated market risk. The study takes a systematic literature review supported by a case study example of the Indian mutual fund market and other chosen world equity markets. The literature review is able to integrate the dynamic of Modern Portfolio Theory, Efficient Market Hypothesis, and behavioral finance to compare the results based on the dimensions of liquidity, return, diversification, and safety. The evidence indicates that SIPs minimize timing risk and enhance a sense of investor discipline, but lump sum allocations are ideal in bullish markets but have high volatility of downside. The case study analysis supports the fact that balanced strategies that combine both of the methods deliver stability during market cycles and investor profile. The gaps identified in the research include the excessive use of urban-based and short-term samples, inadequate cross-class diversification, and under-researched behavioral assumptions. It has implications on policymakers and financial advisors looking to structure investor education schemes, push investment advisory systems through fintech, and create custom wealth management models. The integration of both empirical and strategic analysis based on SWOT analysis provides the study with a subtle road map on how risk-return trade-offs in mutual fund participation can be managed. The keywords include: Systematic Investment Plan (SIP), Lump Sum Investment, Risk Management, Behavioral Finance, and Wealth Accumulation.
Keywords	Systematic Investment Plan (SIP), Lump Sum Investment, Risk Management, Wealth Accumulation, Behavioral Finance, Rupee Cost Averaging
Published In	Volume 16, Issue 4, October-December 2025
Published On	2025-10-20
DOI	https://doi.org/10.71097/IJSAT.v16.i4.8897
Short DOI	https://doi.org/g97s6x

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SIP vs Lump Sum Investment

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