SIP share in incremental folios falls; as investors try bottom fishing

17 Dec 2025 , 04:28 PM

HOW NOVEMBER SIP STORY COMPARES WITH ROLLING AVERAGES 

Before we get into trend analysis of SIP registrations and SIP stoppage ratio, a word of caution. One standout feature of November has been that the share of SIP folio growth in total folios has fallen from 60% to 53%. It remains to be seen if this is a one-off month or whether retail investors are trying to increasingly time the market bottom. We will look at this point in more detail later in this story. Now for the 12-month rolling averages. 

The rolling 12-month new SIP registrations stood at 54.47 lakhs, with November higher. SIP discontinuances averaged 56.51 lakhs in rolling 12 months; distorted by the SIP clean-up. Even in case of net SIP flows, average flows were skewed by those 4 months. The rolling 12-month SIP stoppage stood at 109.42%, but excluding the 4 abnormal months, it was 75.01%. So, latest SIP stoppage ratio at 75.57% for October 2025 is almost at par. 

Transaction  Month	New SIP  Registrations	Total SIPs   Discontinued	Net SIP  Flows	SIP Stoppage   Ratio
Nov-25	57.14	43.18	13.96	75.57%
Oct-25	60.25	45.10	15.15	74.85%
Sep-25	57.73	44.03	13.70	76.27%
Aug-25	55.23	41.15	14.08	74.51%
Jul-25	68.69	43.04	25.65	62.66%
Jun-25	61.91	48.16	13.75	77.79%
May-25	59.15	42.66	16.49	72.12%
Apr-25	46.01	162.32	(116.31)	352.79%
Mar-25	40.19	51.55	(11.36)	128.27%
Feb-25	44.56	54.70	(10.14)	122.76%
Jan-25	56.19	61.33	(5.14)	109.15%
Dec-24	54.27	44.91	9.36	82.75%
Nov-24	49.47	39.14	10.33	79.12%

Data Source: AMFI 

Here is what we read about the SIP stoppage ratio trend. Post-April 2025, SIP stoppage ratio has been consistently under 80%, although the absolute SIP stoppage ratio levels are higher than pandemic peaks. We are yet to get a conformation if this is an aberration or the new normal. There could be various reasons for this inordinate spike in SIP stoppage ratio. It could range from investor reallocation to physical assets, to a higher degree of risk aversion at higher levels. In fact, Direct Plans also played a part in spiking the SIP Stoppage ratio. 

 

HYBRID MF INVESTING – A STRATEGY GOOD ONLY ON PAPER 

One interesting trend visible among retail investors in recent months is a hybrid approach to mutual fund investing. Due to the sharp volatility in the markets, investors are mixing SIPs with occasional lumpsum investments. On paper, this allows retail investors more leeway to manage their allocations. They can also increase allocations after a correction and reduce allocations after a spike. Will such an approach work? 

While the Hybrid MF approach looks good on paper, it has its practical difficulties. Firstly, Even the most seasoned investors find it tough to call crests and troughs in the market. Secondly, empirical evidence shows that too much focus on timing is neither possible, nor essential as returns get distorted even if a few key points are missed. Lastly, investors lose out on rupee-cost averaging; so, they may be better off sticking to SIPs. 

CONTRIBUTING SIP FOLIOS EASE IN NOVEMBER 2025 

Contributing SIP folios have consistently stayed above 90% since the start of FY26. 

Transaction  Month	Outstanding  SIP Folios	Contributing  SIP Folios	Contributing SIP  Folio Ratio
Nov-25	1,001.84	942.52	94.08%
Oct-25	987.88	945.20	95.68%
Sep-25	972.74	925.21	95.11%
Aug-25	959.04	898.70	93.71%
Jul-25	944.97	911.18	96.42%
Jun-25	919.32	864.70	94.06%
May-25	905.57	856.00	94.53%
Apr-25	889.08	838.25	94.28%
Mar-25	1,005.39	811.16	80.68%
Feb-25	1,016.75	826.41	81.28%
Jan-25	1,026.89	834.97	81.31%
Dec-24	1,032.03	827.44	80.18%
Nov-24	1,022.67	797.32	77.96%

Data Source: AMFI 

The Contributing SIP ratio has clearly benefited from elimination of defunct SIPs. In fact, the Contributing SIP ratio has averaged 94.73% since April 2025. Despite the easing of the Contributing SIP ratio in November 2025, it has continued to hover around the mean Contributing SIP ratio. That is a good sign that the per unit contribution of SIPs is improving. The focus has shifted from just the number of SIP folios to the quality and productivity of these SIP folios. That is likely to be long-term positive for the mutual fund industry as a whole. What is more important now is for the retail investors to realize the importance of persisting with SIPs, rather than trying to time the market!