Does the best day to start an SIP really matter? A 30-year Sensex study says barely

For investors planning to start a monthly systematic investment plan (SIP), waiting for the best-performing day may seem like a way to earn higher returns.

But an analysis by WhiteOak Capital Mutual Fund shows that the difference between investing on the best day, the worst day, or a fixed date each month has been relatively narrow over the long term.

The analysis covers 30 years, from August 1996 to July 2026. The returns are measured using XIRR (Extended Internal Rate of Return), which calculates the annualised return on SIP investments while accounting for the timing of each monthly investment.

The BSE Sensex TRI (Total Return Index) captures both changes in Sensex prices and dividends, assuming the dividends are reinvested.

Best day vs worst day: How much difference does it make?

According to the study, a monthly SIP in the BSE Sensex TRI between August 1996 and July 2026 generated an annualised return of 13.75% when investments were made on the best day of each month.

Investing on the worst day of each month delivered 13.27% returns, while investing on the 15th of every month gave 13.53% returns.

The best day is when the Sensex recorded its highest performance in a month, while the worst day is when it recorded its weakest performance.

For example, if three investors had started a ₹1,000 monthly SIP in August 1996 and continued it until July 2026, the total investment over 30 years would have been ₹3.6 lakh.

Based on the given XIRRs, the approximate value of their investments by July 2026 would have been:

• Luckiest investor (best day every month): ₹43.3 lakh
• Most unlucky investor (worst day every month): ₹39.3 lakh
• Disciplined investor (15th of every month): ₹41.4 lakh

The difference in final wealth between the luckiest and unluckiest investors would be around ₹4 lakh, even though both invest the same amount every month for 30 years.

However, the gap between the best and worst outcomes was just 0.48 percentage points over nearly 30 years. The disciplined approach of investing on the 15th of every month also delivered a return close to the two timing-based strategies.

What are the key takeaways for investors?

The study shows that even the least favourable monthly timing did not prevent SIP investments from compounding over the long term.

The key findings of the study are:

• The best day to invest each month is known only after the month has passed. Hence, it is impossible to consistently time the market levels.
• Waiting for the right time to invest can lead to missed opportunities.
• Not investing at all is likely to result in a greater loss than entering an unfavourable market.
• Even the worst market timing may help grow wealth over the long-term.

Disclaimer: This is purely for educational/informational purposes and should not be taken as any sort of investment advice. Always consult a SEBI-registered advisor before making any investment decisions.