Returns made by average MF investor lag those of schemes and SIPs: study

Frequent churn, timing the market eats into gains

Returns made by the average mutual fund (MF) investor are lower than those of scheme or systematic investment plans (SIP). This is true for three broad categories–equity, debt and schemes that invest in both (hybrid)

A study conducted by Axis Mutual Fund shows average annualised return made by an equity MF investor was 13.2 per cent between 2003 and 2020. On the other hand, equity SIPs and funds delivered returns of 14.5 per cent and 18.7 per cent respectively.

Focus on short term returns, timing the market, impulsive investing techniques and frequent churning of the portfolio are the factors that