siliconindia | | NOVEMBER 20258During festive seasons, when bonuses flow and spending spikes, the temptation to make bold, one-time investments often surges. Yet, history shows that market crashes sudden, sharp declines in stock prices can wipe out such lump-sum bets.Systematic Investment Plans (SIPs), with their disciplined, regular investment approach, emerge as a powerful shield against such volatility.Firstly Let's Explore, What SIPs Exactly Are, in Simple Words!SIPs (Systematic Investment Plans) are a smart way to invest money gradually.Instead of putting a large sum in the market all at once which can be risky if markets suddenly fall SIPs spread your investment over time.This helps reduce the impact of market ups and downs.SIPs offer a safer, disciplined approach to investing and can help protect and grow your wealth even during market fluctuations.Countering Festive Impulse with DisciplineFestive seasons, like Diwali in India, trigger emotional spending and investing decisions. Behavioral economics highlights how euphoria from bonuses or market rallies leads to overconfidence, pushing investors toward lump-sum bets at market peaks.Data from the National Stock Exchange (NSE) shows that lump-sum investments made during festive peaks (e.g., October-November) often face losses when markets correct, as seen in the 2008 crash (-51 percent Sensex drop) or the 2020 COVID dip (-38 percent in March).In 2022, Andesh Bhatti, Angel investor & Founder, Collectcent, emphasizes, "As the markets and economy slowly begin to recover from the impact of the pandemic, investors have their focus set on 2022. It will be interesting to see how existing and new drivers of change react to, challenge, and intensify these pandemic-induced patterns".SIPs counter this by enforcing discipline fixed, periodic investments (e.g., 5,000 monthly) reduce the urge to time the market, a near-impossible feat even for experts. By spreading investments across market cycles, SIPs mitigate the psychological trap of chasing highs, ensuring wealth preservation when crashes hit.Amit N. Kothari, Head of Finance, Propelld, says, "Collaborating with other businesses, organizations, and government agencies can provide startups with access to new markets, technologies, and resources".Top 5 Indian Companies Driving SIP-Friendly FundsIn 2025, certain Indian companies consistently appear in top SIP-friendly funds, making them key drivers of growth for investors.· HDFC Bank: A cornerstone of financial stability, HDFC Bank remains a favorite among mutual funds. Its consistent performance, strong market presence, and resilient business model make it a key holding in large-cap and multi-cap SIP portfolios.· ICICI Bank: Another leading financial institution, ICICI Bank, is a frequent pick for SIPs. Its robust earnings, innovative banking solutions, and diversified operations make it attractive for funds seeking long-term growth in the financial sector.By M R Yuvatha, Senior Correspondent, siliconindiaEDITORIAL EXCLUSIVEWHY SIPs ARE THE ULTIMATE SHIELD AGAINST MARKET CRASHES
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