SIP in Multi Asset Funds: A Steady Way to Build Wealth Across Market Cycles

Investors often choose equity systematic investment plans (SIPs) for long-term goals. Despite the fact that SIPs do not require market timing and have the benefit of rupee cost averaging, some investors still find the experience stressful when markets swing sharply. A way to reduce this stress is to use SIPs in multi-asset strategies. A multi asset fund spreads money primarily across equity, debt, and gold. This is done to diversify risk, smoothen returns, and the fund manager dynamically adjusts allocations based on market conditions and in-house models. [EasyDNNnews:PaidContentStart]

Asset Performance Across Different Cycles -
Each asset behaves differently across cycles. Market history shows how leadership keeps shifting across asset classes. In 2014, the Sensex delivered 29.9 per cent. It slowed to 1.9 per cent in 2016. In the same year, bonds gave 12.8 per cent. Gold also led in several periods, including double-digit returns in 2022 (13.9 per cent), 2023 (15.4 per cent), and 2024 (20.6 per cent). These changes show that no single asset class stays on top every year. A SIP in a multi asset portfolio can help offset this volatility. 

Nature of Different Asset Classes -
Equity remains the growth driver. It benefits from earnings cycles and domestic demand. Equity growth is supported by stronger earnings and better credit growth. But equity can also see sharp corrections. Some investors stop SIPs when markets fall. This breaks the whole purpose of a SIP. Debt works differently. It offers stability. Yields stay more stable. It can also provide steady income. 

However, gold responds differently from both equity and debt. It usually helps during global uncertainty. It protected well during 2020 when returns touched 28 per cent. Since each asset behaves differently, combining them in one SIP gives a more even ride. 

A measured asset allocation framework uses each asset class optimally. The mix of equity, debt, gold and silver, REITs and InvITs, and preference shares, etc., lowers the impact of any single asset class. During strong equity phases, equity carries the portfolio. During corrections, debt and gold provide stability. Others provide balance. This harmony helps SIP investors stay invested for longer periods. This spreading of money across different asset classes, which behave differently in different market cycles, also provides diversification, which is the backbone of a multi-asset fund. This variation supports the case for a SIP that relies on more than one driver of return. A SIP in a multi-asset fund uses the natural difference across assets to build a smoother long-term path. 

Steady Long-Term SIP Performance in Multi Asset Funds - It is also important to understand how compounding has worked across long periods for the multiasset SIP approach. Let us take a benchmark of Nifty 200 TRI (65 per cent) + Nifty Composite Debt Index (25 per cent) + Domestic Price of Gold (6 per cent) + Domestic Price of Silver (1 per cent) + iCOMDEX Composite Index (3 per cent) to reflect the mix. So, a monthly SIP of `10,000 for five years grew at 14.5 per cent XIRR; ten years grew at 14.3 per cent XIRR. Over fifteen years, the same delivered 13.4 per cent XIRR. These numbers highlight two points. First, multi-asset strategies can keep long-term returns steady across cycles. Second, SIPs continue to benefit even when the market phases change several times. (Data as on October 31, 2025) 

Tax Efficiency - Internal rebalancing within the fund does not create any capital gains tax liability for the investor. Further, funds with equity allocation above 65 per cent qualify for equity taxation, while lower allocation makes the fund qualify for debt taxation. 

Professional and Expert Management - In multiasset funds, the fund manager decides how much goes into each asset, shifts weights as conditions change, selects instruments, and handles rebalancing. They integrate valuations, macro views, and risk limits, maintain tax and cost efficiency, and manage liquidity. Essentially, they run a disciplined, actively monitored, carefully designed asset-allocation engine for investors. Investors can try, but very few can match a professional discipline, data, speed of response, risk controls, and emotion-free execution across cycles. 

Takeaway - Investors who want a more balanced wealthbuilding journey can consider SIPs in proven multi-asset strategies. It avoids the emotional pressure that comes from only equity SIPs during volatile years. It also offers the comfort of seeing all asset classes contribute at different times. 

The writer is Director, NPS Associates Private Limited ▪️Email ID : [email protected] ▪️Website: https://wealthgrowth.in 

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