A mutual fund study spanning 15 years, and our own direct-equity research spanning 35, point to the same conclusion: the hardest part of investing was never what you bought, or even when. It was staying long enough for the maths to work.
Every few months, a client forwards us a screenshot of their portfolio and asks a version of the same question: “It’s been two years and it has barely moved. Should I get out?” It is a fair question, and the short-term numbers seem to justify the anxiety. But it is also the single most expensive question an investor can act on — because the entire case for equity rests on a variable most people refuse to give it: time.
This month, ET Wealth and Crisil Intelligence published a fresh study built on fifteen years of rolling data across 120 diversified equity mutual fund schemes. It is rigorous, and its conclusion is unambiguous. It also confirms — from an entirely independent angle — what Vasupradah’s own research has been telling us for years. Our study is different in design but identical in verdict, and the two together make the argument almost impossible to dismiss.
ET Wealth–Crisil SIP Study 2026
- 15 years of rolling data
- 120 diversified equity mutual fund schemes
- SIP model only
- Tenures from 1 to 10 years
- Tests how a crash (Covid 2020) affects outcomes
Vasupradah Direct-Equity Research
- 35 years of market history
- Sensex & high-quality, well-managed companies
- Both lumpsum and SIP models
- Entry at market tops and bottoms alike
- Tests whether timing matters versus tenure
The two-year trap
Here is why short-term returns are a terrible basis for any decision. In the ET Wealth–Crisil data, of the 295 actively managed diversified equity schemes with a two-year track record, roughly 26% had made no money at all if you had started your SIP two years ago. Nearly 54% failed to beat even a 5% return, and just 1% managed to cross 10%. On a one-year SIP, the probability of seeing a negative number is 22.7% — you would lose money nearly one time in four.
If you judge equity by its first year or two, you are judging a marathon runner by the first 400 metres. The asset class was never designed to perform on that timescale — and the cruel irony is that this is exactly the window in which most investors quit.
22.7%
Chance of a loss · 1-year SIP
~2%
Chance of a loss · 6 years
0%
Loss over 7+ years*
What changes with time
As the holding period lengthens, the probability of loss collapses. The ET Wealth–Crisil data shows the chance of a negative return falling from 22.7% in year one, to 10.1% in year two, to 5.1% in year three, to 2.3% by year five, and to just 0.2% by year eight. Mirror this against the upside: the probability of earning more than 10% crosses 80% from the four-year mark and climbs to 98.6% for ten-year SIPs.
This is precisely where our own work converges with the published study — and extends it. Vasupradah’s research examined the last 35 years of direct equity investing in the Sensex and in high-quality, well-managed companies, testing both lumpsum and SIP approaches, and deliberately including investments made at the worst possible moments — the market tops. The purpose was to answer the question every investor secretly fears: does it matter if I invest at the peak?
The finding was striking. Across full market cycles, once the holding period crossed roughly seven years, the probability of ending in negative territory effectively vanished — and a seven-year-plus horizon delivered positive returns 100% of the time, whether the money went in as a lumpsum or as a SIP, and regardless of whether it was invested at a market top or a market bottom. Timing the entry, it turns out, changed how quickly you reached safety — never whether you got there.
The Vasupradah View
Investors spend enormous energy trying to time the market. Our 35-year evidence says the better question is far simpler: are you prepared to hold quality for seven years? Get that right, and entry timing becomes a footnote.
Why timing matters less than you think
Consider the investor’s nightmare: putting a lumpsum into the market at its absolute peak, just before a crash. In the short run, the pain is real. But because high-quality companies compound their earnings through the cycle, the price you “overpaid” is steadily diluted by years of business growth. Over a seven-year-plus window, the entry point — top or bottom — became almost irrelevant to the final outcome in our data. What mattered was the quality of what you owned, and the patience to keep owning it.
This is why we are relentless about the quality of companies on our research desk, and equally relentless about holding period in our conversations with clients. The two are the only levers that reliably move the needle. Chasing the perfect entry day is, statistically, a waste of the energy better spent on conviction.
Consistency, not fireworks
The ET Wealth–Crisil numbers settle into a recognisable shape. Average SIP returns stabilise around 15% once you cross the five-year mark, and the worst outcome over a full ten-year SIP in their study was still a positive 7%. The chance of a spectacular 20%-plus return is actually highest on short one-year SIPs (37.8%) and falls to 8.9% by year ten. Long tenures are about reliability, not lottery tickets — time trades the thrill of the peak for the near-certainty of the outcome.
Category still shapes magnitude. Over a ten-year horizon, the study found small-cap funds carried a 41.8% chance of delivering 20%-plus returns, and mid-caps 17.3% — while large-caps had virtually none, settling instead into a steady ~13.5% average. The lesson is not to crowd into small-caps; it is that a slightly lower return earned consistently, and actually held through, beats a higher return you abandon midway.
Probability of a loss, by holding period
| Held for | Chance of a loss | What it means |
|---|---|---|
| 1 year | 22.7% | Roughly 1 in 4 |
| 3 years | 5.1% | 1 in 20 |
| 5 years | 2.3% | Rare |
| 6 years | 1.6% | Very rare |
| 7 years + | 0%* | None, in our data |
1- to 6-year figures: ET Wealth–Crisil Intelligence SIP Study 2026 (mutual funds). *7-year-plus “zero loss / 100% positive” threshold per Vasupradah’s 35-year direct-equity research on the Sensex and high-quality companies, lumpsum and SIP, across all entry points.
The crash that proved the point
This year’s ET Wealth–Crisil study added a question the averages never answer: what does the journey actually feel like when markets fall apart? It tracked SIP investors through the Covid crash of March 2020 — assuming, as we always counsel, that they did not stop.
The contrast is stark. A one-year SIP investor watched their return crater to around minus 50.3% at the trough — a fall of 66.6 percentage points in weeks. The pain eased steadily with tenure: two-year SIPs fell to -30.4%, three-year to -20.9%, four-year to -13.1%, and five-year to just -8.8%. By the sixth and seventh years the damage was almost fully contained (-4.9% and -0.6%), and most eight- and nine-year investors stayed in positive territory even at the market’s worst moment. Recovery told the same story: a one-year investor took about 122 days to climb back above zero; a nine-year investor took just two. Six years on, by March 2026, every one of those cohorts was sitting on annualised returns of roughly 12.3% to 13.5%.
Time protects more than your money
An investor staring at a 50% loss is in real pain and far more likely to panic and sell at the bottom. An investor seven years in barely felt the crash. Time in the market does not just protect your returns — it protects your behaviour at the exact moment good behaviour matters most.
The honest difficulty
If the answer is this clear, why do so few investors capture it? Because completing seven years in equity is a test of temperament, not arithmetic. Ground-level data shows only a small fraction of SIPs run uninterrupted for even a decade. Life intervenes — a job loss, a medical bill, a correction that tests conviction, or simply the very human urge to do something when a portfolio turns red.
The encouraging news is that “staying invested” need not mean a perfectly untouched portfolio. Pausing what is tied to distant goals while protecting the essentials, or trimming the monthly amount rather than stopping outright, keeps you inside the compounding machine. Investing something is almost always better than investing nothing, because you are still accumulating quality at lower prices when markets fall.
The cost of forgetting this is not theoretical. The ET Wealth–Crisil study profiled a Mumbai investor who stopped a ₹1 lakh monthly SIP in 2022 and moved the money elsewhere. The corpus he stopped contributing to is worth around ₹46.68 lakh today; had he simply continued, a conservative estimate puts the figure at over ₹1.17 crore — an opportunity cost of roughly ₹70 lakh for the comfort of “doing something.” Markets, meanwhile, vote with their feet: industry SIP inflows crossed ₹32,000 crore in a single month for the first time even as the Sensex fell 11.5% that month, with equity funds seeing net inflows for the 61st consecutive month. The disciplined are still buying.
So the next time the two-year screenshot arrives, the question we will ask in return is not “how has it performed?” It will be the only two questions that have ever mattered: Is what you own genuinely worth owning — and are you willing to hold it for seven years? Answer both honestly, and history hands you a remarkably generous outcome.
Author Information
Author & Reviewed By: Jaideep Menon
About the Author:
Jaideep Sankarankutty Menon is a market professional with over three decades of experience in financial markets, investment research, and wealth management. As part of Vasupradah Investment Advisory Services, he focuses on helping investors make informed, long-term financial decisions through research-driven investment strategies.
Disclaimer:
This article is for educational purposes only and should not be considered investment advice. Investments are subject to market risks.