Veteran investor Shankar Sharma has entered the ongoing debate around Systematic Investment Plans (SIPs) with a unique perspective on transparency. According to reports from LiveMint, Sharma argued that the easiest way to resolve the ongoing debate is for everyone commenting on SIPs to first disclose their own interests. He stated that understanding the motivations of those participating in the discussion would help investors better judge the credibility of their arguments, using the phrase 'Doodh ka doodh clear ho jayega' (translating to 'Milk of the same kind').
Sharma disclosed his own position by stating he has no commercial interest in whether SIPs generate returns for investors. As reported by LiveMint, he emphasized that investment outcomes are a matter between investors and the professionals managing their money, saying 'I disclose mine: I have no concern whether SIPs make money for investors or not. It's not my business. It's between Investors and their wealth guardians'. This declaration comes after veteran fund manager Samir Arora defended SIP investing and questioned the effectiveness of market timing.
Despite his lack of commercial interest, Sharma clarified his concerns lie in broader macroeconomic implications. According to LiveMint reports, he expressed concern that SIP-driven flows provide exit liquidity to foreign institutional investors (FIIs), which can weaken the Indian rupee and affect returns for overseas investors. He argued that the resulting currency weakness could have wider economic consequences, including higher inflation and broader financial stress. These concerns shift the debate from whether SIPs are inherently good or bad to the incentives of those making the arguments.
Sharma revealed he would no longer publicly criticize SIPs due to his long-standing personal and professional association with Samir Arora. As reported by LiveMint, he recalled that Arora was among the earliest supporters of his institutional brokerage business during the mid-1990s and stated he would not go against someone who had backed him at an important stage of his career. He concluded by declaring 'I shall, hereafter, never say a word publicly against SIPs. I can't do namak haraami. Isliye, aaj sey, apun BULLISH SIPs!'
