Does investing daily through SIPs generate meaningfully higher returns than monthly or quarterly investing? - Let's understand looking at data
Evaluating data for past for 15 years, Shivam Pathak, Certified Financial Planner, say:
- If you do daily SIP, the expected return is 13.83%
- Meanwhile, with monthly and quaterly SIPs, the expected return is 13.80%.
So, if you look all three instances, there is no big difference in the frequency. So you can select the frequency as per your requirement.
The better question than “Which SIP frequency gives the highest return?” is: Which SIP frequency suits your cash flow and helps you stay disciplined?, he suggests
A simple framework:
- Monthly SIP – Suitable for salaried individuals with monthly income
- Daily SIP – Suitable for investors who prefer regular deployment
- Quarterly SIP – Suitable for those with uneven or seasonal income
Let's understand with 2 different use cases:
Scenario 1: Shivam has a steady income of ₹50,000 per month and another freelance income of roughly ₹10,000 per week. He want's to understand - which SIP frequency would give him better return - Daily SIP, monthly SIP or Quarterly SIP?
Admiting with Pathak, Abhishek Kumar, SEBI RIA, Founder- SahajMoney, said “Long term Indian equity data shows that SIP frequency has a negligible impact on your final returns.”
Backtests over 15 to 20 years on the Nifty 50 TRI reveal that daily, monthly, and quarterly SIPs deliver nearly identical XIRR when the total amount invested is the same, with variations limited to a few minor basis points.
Here's the strategy Shivam should follow:
For your cash flow, the smartest approach is to map your investments to your income pattern rather than chasing a mathematical edge that does not exist.
You should automate a primary monthly SIP right after your salary credits and accumulate your weekly freelance income to deploy either as a single monthly top up or across two to four fixed dates in a month.
Scenario 2: Vinay earns a stable monthly income of ₹1 lakh per month but is unsure which SIP mode can maximise returns — daily SIP, monthly SIP, or quarterly SIP.
Here's the strategy Vinay should follow:
For a high ticket regular income of ₹1 lakh per month, running a daily SIP introduces massive operational complexity, hundreds of bank transactions, and potential reconciliation issues without any yield upside, Kumar adds
Your optimal strategy is to use a clean monthly setup, perhaps splitting the amount across two to four distinct dates in the month to mitigate single day execution risks and smoothly manage high volume liquidity.
If your goal is long-term wealth creation, a disciplined monthly SIP with annual step-ups will likely outperform a perfectly timed “frequency optimisation” strategy.
