India's Systematic Investment Plan stoppage ratio crossed 100% for the first time in 11 months, as volatile markets made investors jittery. According to Association of Mutual Funds of India data, 53.38 lakh SIP accounts were stopped or matured last month, compared to 52.82 lakh new SIP accounts opened. This represents a significant shift from February's 76% stoppage ratio when 49.70 lakh accounts were stopped against 65.72 lakh new accounts opened. The current surge reflects investor panic as one- and two-year SIP returns turned negative in recent months, with markets experiencing 16% decline over the past two months.
Despite the challenging market environment, Balanced Advantage Funds (BAFs) have demonstrated varying approaches to market navigation. According to Mint analysis, India's five largest BAFs by assets under management all adjusted equity exposure during the Nifty 50's full cycle from January 2024 to March 2026, but with different timing, range and conviction. HDFC BAF tracks earnings yield, bond yields and trailing P/E multiples, steadily reducing exposure from 57% to 49% during the 2024 rally and increasing to nearly 70% by 2026. ICICI Prudential BAF anchors on price-to-book valuation, cutting exposure from 41% to below 32% during the rally and reaching 62% by March 2026. Edelweiss BAF follows a pro-cyclical momentum-driven approach, maintaining 63-70% allocation during rallies and cutting to 44% during corrections.
Markets have experienced significant turbulence over the past two months, with 16% decline leading to widespread SIP stoppages. As reported by The Hindu BusinessLine, Jeevan Kumar KC, Head - Investment Advisory Services at Geojit Financial Services, explained that investors panicked amid negative returns from popular SIP categories such as small, mid and flexi caps over a one- to two-year time frame. Despite the current challenges, industry experts maintain that SIP inflows increased 21% last fiscal to ₹3.50 lakh crore, up from ₹2.89 lakh crore in FY'25. The Nifty 50 ran through a full cycle, rallying 19% from around 21,700 to over 25,800, correcting 14% through February 2025, and showing fresh weakness in early 2026 amid the West Asia war.
Despite current challenges, market experts remain optimistic about the long-term outlook while emphasizing the importance of understanding fund models. Aditya Agrawal, Chief Investment Officer at Avisa Wealth Creators, noted that the rise in SIP stoppage ratio reflects short-term volatility rather than structural slowdown in systematic investing. As reported by The Hindu BusinessLine, he emphasized that markets have shown positive signs since the start of this month with early signs of peace returning in West Asia. For long-term investors, staying invested through SIPs during corrections often improves average purchase cost and future return potential, with India's structural growth story remaining supportive despite intermittent volatility. Industry experts stress that BAFs work best with at least a five-year horizon and require careful assessment of historical equity ranges to align with individual risk tolerance.
