Investment News: SIP i.e. Systematic Investment Plan is the most popular method of investment among the people. But for some time now it has been seen that people are closing their SIPs. There have been fluctuations in the market for quite some time, due to which investors are deciding to close their SIPs in large numbers. This is being seen for the first time in 11 months when such a large number of people are closing their investments.

What do the figures say?
According to India Today report, for the first time in the last 11 months, the number of SIPs closed has been more than the number of SIPs started. Last month, about 53.38 lakh SIPs were closed or matured, while only 52.82 lakh new SIPs were opened. These figures show changing investor behavior and increasing discomfort in view of market volatility.

Why is this happening?
Actually, fluctuations in the market are nothing new, but the volatility seen recently has troubled many investors. When investors open the app and see their account red, they get nervous. In fact, in many funds the returns from one year and two year SIPs have become negative, which is quite disappointing. In such a situation, people feel it is better that they stop it.

The decision is right in some circumstances
However, in some circumstances the decision to stop SIP may also be right. For example, if you have lost your job, there is a serious financial crisis, or the investment target has been achieved, then you can stop SIP, this will be considered the right decision. Apart from this, if a fund is not working i.e. it is not getting any significant returns then it may be better to transfer the fund instead of closing it.

India’s capital markets regulator Securities and Exchange Board of India (SEBI) has updated the classification rules of mutual fund schemes on 26 February. The new rules will replace the old categorization rules of 6 October 2025 and 6 November 2025 and will be applicable to mutual funds, AMCs, trustee companies and AMFIs. Now mutual fund schemes will be in 5 broad groups: Equity, Debt, Hybrid, Life Cycle Funds and Other Schemes. The biggest change has come in Equity Funds, where the minimum allocation for each category has been fixed. Multi Cap Funds will now invest at least 75% in equity, comprising 25% large-cap, 25% mid-cap and 25% small-cap. Minimum 80% allocation in Large Cap Funds and 35%-35% in Large & Mid Cap Funds will be mandatory.

Investors will invest money where they get returns and this trend is now clearly visible in gold after equity. For the first time, inflows into Gold ETFs have been more than equity. According to AMFI data, inflows into gold ETFs increased by 106% in January, while inflows into equity mutual funds declined. Market volatility, geo-political tensions and safe-haven demand have strengthened gold. In the last 1 year, Gold ETFs have given around 75% returns, which has further increased the confidence of investors.