My SIP Is Down 15% in 6 Months — Should I Stop?

First: you are not alone, and this is not unusual. A 15% drawdown on a 6-month-old equity SIP is within the normal range of outcomes — it has happened roughly once every five years on Indian equity indices, and investors who stayed through those periods recovered fully and then some. That said, your instinct to question the decision is healthy. The answer depends on one thing: is this a market-wide correction, or is your specific fund deteriorating?

Quick answer: A 15% drawdown in 6 months is a normal equity event, not a signal to stop. The lower NAV means your current SIP instalments are buying more units than last month — rupee-cost averaging is working in your favour right now. Stop only if your specific fund is underperforming its category peers by a significant margin over 1–3 years, or if your cash flow genuinely cannot sustain the SIP.

What a 15% Drawdown Actually Means for Your SIP

When your portfolio statement shows −15%, it means the current value of your invested amount is 15% lower than what you put in. But your SIP is not a single lump-sum investment you made at peak — it is a series of monthly contributions. Some of those units were bought at higher NAVs, some at lower. The current drawdown is a blended picture.

Here is what is actually happening for an investor who has been contributing ₹10,000/month:

Total invested: ₹60,000. Total units: 640.8. Current value at ₹85 NAV: ₹54,468. Return: −9.2%.

But look at what happens when the NAV recovers to ₹105 — not a new high, just back to where it was in Month 2:

Current value at ₹105 NAV: 640.8 units × ₹105 = ₹67,284. Return: +12.1% on ₹60,000 invested.

The investor who stopped at Month 4 has 308.2 units (bought in months 1–3). At ₹105 NAV: ₹32,361 on ₹30,000 invested — return of 7.9%.

The same recovery produces better returns for the investor who continued through the drawdown, because they accumulated more units at lower prices.

If you want a fee-only advisor to review your specific fund holdings and tell you whether continuing makes sense, get a free portfolio audit.

Historical Indian Equity Drawdowns and Recovery Times

The anxiety during a drawdown is real. Knowing what has historically happened in comparable situations does not eliminate the discomfort, but it gives you a frame.

A 15% drawdown over 6 months sits in the "mid-severity, 6–12 month recovery" category historically. None of the events above — including the two 55%+ crashes — left an investor who stayed the course with a permanent loss in a diversified equity fund.

This is not a guarantee. Past market behaviour does not guarantee future outcomes. But the base rate for Indian equity recovery over any 7-year rolling period is strong.

The 2008–09 Case Study: Two Investors, Same Fund

Both investors are running a ₹50,000/month SIP in a Nifty 50 index fund. Investor A continues through the crash. Investor B stops in February 2009 (near the bottom) and restarts in January 2010 after the market has recovered significantly.

Investor A — Continuous SIP, Jan 2008–Dec 2012 (60 months)

• Total invested: ₹30 lakh
• Units accumulated: include the cheap months of Oct 2008–Mar 2009
• Value at Dec 2012 (Nifty ~5900): approximately ₹38 lakh
• XIRR: ~15%

Investor B — Stopped Feb 2009, resumed Jan 2010 (51 effective months of contributions)

• Total invested: ₹25.5 lakh
• Missed: Oct 2008, Nov 2008, Dec 2008, Jan 2009 — the four cheapest months of the decade
• Value at Dec 2012: approximately ₹28 lakh
• XIRR: ~7%

The missed months were the most valuable of the entire 5-year SIP. Investor B saved ₹4.5 lakh in instalments. Investor A's extra ₹4.5 lakh of contributions — bought at the absolute bottom — generated ₹10 lakh in additional corpus by 2012.

When Stopping IS the Right Call

The case for stopping is not "the market is down." It is one of these:

1. Fund-specific underperformance, not market-wide. If your mid-cap fund is down 20% but the Nifty Mid-cap 150 index is down only 10%, your fund is underperforming its benchmark by 10 percentage points. That is not market noise — that is a fund problem. Compare your fund's return to its category average on any major fund tracker. If the gap is persistent over 1–3 years (not just 6 months), a fund change is worth considering. You can stop the SIP in the underperforming fund and start one in a better fund — this is a fund quality decision, not a market timing one.

2. You genuinely need the cash. If the ₹20,000/month SIP is preventing you from meeting a near-term financial obligation — an EMI, a medical expense, a child's school fee — then reducing or pausing is the right call. The market level is irrelevant. Cash flow management comes first.

3. Your investment thesis has fundamentally changed. If you have new information about why this asset class is wrong for your specific situation — a significant change in your time horizon, a move from equity-appropriate to a capital-preservation phase — then stopping makes sense. This is rare and should be based on your own financial situation, not on a market movement.

The Diagnostic Question to Ask Right Now

Before deciding, answer this:

Is my fund underperforming its category peers over the last 12 months, or is the entire category down together?

Check on ValueResearch, Morningstar India, or AMFI's fund factsheets. Compare your fund's 6-month and 1-year returns to:

• Its benchmark index
• The category average (large-cap, mid-cap, etc.)

If your fund is tracking its category, the decline is market-wide. Continue. If your fund is significantly behind its category, investigate the fund — not the market.

FAQ

My portfolio is showing −₹2 lakh. I feel like I am just throwing money away every month.

The −₹2 lakh is the mark-to-market loss on money you have already invested. The monthly SIP instalment you are adding now is buying units at a discount compared to last quarter. The two are separate: the past loss is unrealised and will likely recover; the current contribution is getting better value than it was 6 months ago. Stopping the SIP does not recover the past loss — it just means you do not get the discounted units.

Should I increase my SIP during a drawdown to take advantage of the lower NAV?

If your cash flow allows it, a temporary top-up during a significant drawdown is sensible. You do not need to make it permanent — even a one-time lump-sum addition or a 3-month increase in SIP amount during the trough can meaningfully improve your eventual XIRR. Do not borrow to do this. Use only surplus cash.

My SIP is in a sectoral/thematic fund that is down 20%. Is that different?

Yes, materially different. A sectoral fund (IT, pharma, PSU, infrastructure) concentrates risk in a single theme. If that sector is facing structural headwinds — regulatory changes, commodity cycles, policy shifts — a 20% drawdown may not recover on the same timeline as a diversified equity fund. Sectoral funds require an active view on the sector. If you do not have a conviction on the sector's medium-term outlook, a move to a diversified fund is defensible here — not because markets are down, but because concentrated sector risk requires ongoing management.

What if my fund manager just left the AMC?

A fund manager departure is a legitimate reason to reassess a fund — not to panic, but to investigate. Key questions: Who has taken over? Is the replacement internal (understands the existing portfolio) or external? Has the fund's investment process changed? Has performance diverged from benchmark post-departure? A 3–6 month observation period after a manager change, while continuing existing SIPs, is reasonable. See Should I Redeem and Re-Enter at a Lower NAV? for when switching funds is actually worth the tax cost.

How long should I give a fund before deciding it is underperforming?

Three years is the minimum meaningful evaluation window for actively managed equity funds. Six months or even one year of underperformance can be explained by style cycles — a value-oriented fund in a growth rally, a small-cap fund in a large-cap bull run. Three years of consistent underperformance versus both benchmark and category peers is a signal that the fund's process or execution has a structural problem.

The hardest thing about a drawdown is that the discomfort peaks exactly when continuing is most mathematically valuable. If you are finding it difficult to hold course, talking to a fee-only advisor — not to be told "don't worry," but to have a specific view of your fund quality and portfolio allocation — can make the decision clearer. Get a free portfolio audit →