At Scripbox, we always advise long-term investors to keep investing every month and to ignore market movements. It is but natural to feel concerned about your money when the market goes down. Most queries we get from investors are on the following lines:
I started investing 5 months ago and I'm losing money. Should I continue my SIP
It's easy for you to give this advice but it's my money and I think I'm just going to stop!
We created the below graphic to show you how your investments made in the previous months will look as months pass.
Green means you have a positive return on that month's investment, and red means negative. This is based on actual Nifty values over the last 10 years.
What this graphic shows
1. There will be periods where some of your monthly investments will be losing money
2. For periods less than 2-3 years, it is quite possible that all your investments are in red
3. Over time, the gains out number losses and you gain from the volatility.
Why should you put up with all of this uncertainty?
On the right, we show how much money you would have accumulated (about Rs 18.6 Lakhs) over 10 years if you were investing Rs 10,000 every month. The market ups and downs work in your favour. The money you invest when market is down gets a disproportionate gain.
So what's the conclusion?
Invest in equities only if your investment horizon is at least 5 years (7 to 10 years or longer is better). Equity investing is not a quick-fix wealth accumulation option.
How can Scripbox help you?
The best way for you to benefit from Equity Mutual Funds is to invest in it. We help you do it the right way - automatically.
1. By picking the best mutual funds using our scientific process
2. By monitoring and reviewing your investments annually
3. Helping you manage your investments better by ensuring you don't lose money to taxes and exit loads.