I Invested In An SIP Mutual Fund For 22 Months And Here’s What Happened

Why SIP Mutual Funds?

About two years ago, I began investing a portion of my salary into an SIP Mutual Fund. I chose to invest in an SIP Mutual Fund for two reasons – the first reason was that I was investing for the long term, and so, I could take on a greater amount of risk. The second reason was that SIPs allowed me to make small investments every month, as opposed to a large one time investment (which I didn’t have the money for). I’ve been paying out instalments for 22 months now, and I thought I’d share how it’s working out for me so far.

How Do SIP Mutual Funds Work?

Ok, here’s the short explanation of how SIPs work. When you invest in a Mutual Fund, you are purchasing ‘units’. The cost at which you purchase a unit of a Mutual Fund is known as the NAV (Net Asset Value). When you invest through SIP, you pay a fixed sum of money every month to purchase units. I am currently investing Rs.15,000/- a month into my SIP Mutual Fund.

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My Journey So Far

I want you to take a look at the table below:

sip mutual fund


Upon first glance, it might look like little beetles running through the screen. The key with understanding tables is to look at information, column by column.

First Column: Month

This shows when I started Investing – I began sometime late in October 2015. Since the SIP auto deducts the amount from my bank account during the first week, the Mutual Fund took my first investment to be that of November’s (which is why you won’t see an entry under ‘Amount invested’ for the month of November.

Second Column: Amount Invested

I started out with (and continue to invest) an amount of Rs.15,000/- every month. It is considerable portion of my salary, but I consciously decided on this amount because my spending habits had hit the roof that year. When you divert your salary to savings as soon as its credited, you will automatically have a budget for your expenses.

Instead of

Salary – Spending budget = Saving,

opt for

Salary – Saving = Spending budget.

Such simple, much genius.

NAV & Number of Units Purchased

The action begins! Now, if you rewind you’ll remember that the cost of one unit in a Mutual Fund is its NAV. The NAV of a Mutual Fund changes every day depending on the stocks that make up the Mutual Fund. In October 2015, you’ll see that I made my first purchase of units at an NAV of Rs.23. So, one unit in the Mutual Fund cost Rs.23/- in October. Investing Rs.15,000/-, got me 652 units.

Now, as the months progress (till about February 2016), you can see that the NAV is dipping. 23 became 22, 22 became 21, and so on. In February 16, it stands somewhere around Rs.19/-.If you look at the Number of Units purchased, you can see that it’s increasing.

That’s because the lower the NAV, the greater the number of units your money gets you.

Since I’d just started investing, this was really discouraging for me. I even contemplated stopping the investment, but decided to see how the fund performed for a few more months before pulling the plug.

Boy, am I glad I persevered.

From March, the NAV starts increasing. It goes back to 22 a few times but after January 2017 it’s really shot up. When I invested this month (July 2017), it was Rs.27.

Now, here’s why persevering was worth it:

When the NAV dipped, my investment of 15k was able to fetch me more units. This seemed pointless at the beginning but as the NAV increased, the value of my investment increased because I’d all these units that I had accumulated at a lower cost. If you compare the Total Value column with the Total Invested column you can see that after April 2016, it’s only gone up.

The initial dip in NAV had actually boosted my investment because it gave me more units.

Where I Stand Now

I’ve invested Rs. 3,15,000/- so far, and my investment’s value is around Rs.3,65,000/-. That’s a whopping Rs.50,000/- profit! Also, I was paid a dividend of Rs.13,000/- approx last August – nearly a month’s instalment/investment.

So that’s a total of Rs.63,000/- that I have earned over the course of 22 months.

What percentage of return is that? I’ll talk about how to calculate returns on investment in my next post.


  1. XIRR is a method to identify your actual rate of interest in SIPs. SIP in Mutual funds are a good way to save for retirement, but when I started off, I was confused with the sheer number of funds available to invest in. It paralyzed me before I started! Then I found scripbox through a friend who worked there and started off on it. They have a method to shortlist a few funds that investors can invest in. Been about 22 months so far and the returns have been similar to yours too. It would be a test of grit to keep doing it even when the markets are down !

  2. Nice Post Lavanya. Shall wait for the next too. I have been thinking, discussing about this from a long time but have not invested till now. The main reason being these questions n doubts – who is the right person / agent, which is the right fund, how to proceed, what are the charges and things like that..

    Its high time now that i better invest before repenting.

  3. Hi
    Excellent informative post. Keep them coming. If you could throw some light on the tax benefits of such an investment it’ll be greatly appreciated.
    Just started earning money on own and would like to make some informed decisions.
    Thank you

  4. A very useful post!! But kindly can you do a post for mutual fund basics. There are many women like me, who doesn’t know about how to get it started. Thanks in advance.

  5. Hi Ms.Lavanya
    A simple and a educative blog on MF Investments by SIP.

    Is the blog on calculating the Return on Investment is already published? Pls share the link if done

  6. Hi there,

    Can I know you invested on this funds on your own, or was it done by some agents. If so can you refer them. Thanks!

  7. Hey. Fantastic post. Can you please explain in a post types of SIP mutual funds and how their payout works. If a SIP is for duration 12 months is the money with profit/loss returned?

  8. When you think of savings it’s a big ouch because it’s going to cut into your savings. But not with mutual funds is what I have learnt through this post. Small investment every month which gives big returns after a period of time. Save less and have more to spend in a couple of years!

  9. Hey, great post! How did you select a SIP scheme to invest?

  10. Hi Lavanya

    I read this blog and bookmarked it sometime back. I just came back to ask if you have continued this SIP and where it stands today.

    I don’t wanna know the actual numbers (if you’re a private person in that sense), but just wanna understand how dividend MFs work. How often and in what amount do they give payouts (dividends)?

    I’m thinking of investing in a dividend MF and I have no one in my family/friends who has done that before. No prior experience, so a little hesitant.

    Thanks in advance.

  11. SIP or Systematic Investment Plan that is marketed as the safe and best route for investments in the equities and outperform markets to create good growth over a longer period of time. However, is SIP investment safe enough? Yes, mutual fund SIP is the safest route of investment.

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