Staying Invested & Choosing the Right Mutual Funds in Uncertain Markets

Markets are funny. Sometimes they soar, sometimes they crash, and sometimes… they just go nowhere. For most investors, the third situation is the most frustrating. A year of stagnant returns can make you wonder: “Should I stop my SIPs? Should I redeem everything and wait? Should I have just left the money in a bank FD?”

In a recent Indmoney podcast with Ashish Somaiyaa (CEO, White Oak Capital AMC), he explained why sideways markets test investor patience—and why this is exactly the time to stay invested. He also shared timeless lessons on how to choose the right mutual funds, so that you can hold on with confidence even when the market feels stuck.

Why Sideways Markets Test Investors

• When markets rise, everyone feels like a genius.
• When markets crash, fear dominates, but at least there’s clarity.
• When markets stay flat for months, it’s the most confusing phase.

Over the past year, one-year returns have been near zero. That’s when doubts creep in: “Gold would have been better… FDs would have been better…”

But as Ashish explained, this is not a bug—it’s a feature of equity markets. Historically, the Nifty has fallen 15–20% from its yearly high every year, and small-cap indices fall even more. That volatility is part of the design.

You can watch the full podcast here, where Ashish talks in detail about market phases, SIPs, and investor psychology:

The Case for Staying Invested

Stopping your SIP during dull or falling markets is like leaving the stadium when the match gets slow, you miss the best overs.

• Over 30–35 years, Indian equity markets have delivered ~14% compounded annual growth.
• Short-term noise doesn’t change the long-term compounding story.
• In fact, smart investors use volatility to their advantage.

Ashish gave a simple tweak: Whenever markets fall 10–15% from their highs, add one or two extra SIP instalments. These extra investments during dips are what push long-term returns above average.

Choosing the Right Mutual Fund in Such Times

When markets feel dull or uncertain, the instinct is to look for the “best” mutual fund by checking who gave the highest return last year. But that’s often misleading. A fund that tops the charts in one year usually did so by taking higher risks, and the same fund can easily slip to the bottom the next year.

What matters more is consistency. A good fund should do well when markets are strong, and in weaker times, it should at least hold steady—not collapse. Think of it like a reliable player: you don’t need sixes in every over, but you want steady runs on the board.

To help investors judge this, SEBI has recently introduced the Information Ratio—a measure of not just beating the benchmark, but doing so consistently. This is a much better lens than looking at one-year CAGR.

Expense ratios also matter, but they shouldn’t be your starting point. Low cost is good, but if a fund house has a strong philosophy and has shown steady performance, that matters more than saving a few decimal points in fees.

And when it comes to categories, for long-term goals it’s best to stick with diversified funds like Multi-Cap or Flexi-Cap. They automatically spread your money across large, mid, and small companies, saving you from constant rebalancing.

The bottom line: don’t chase last year’s winner. Choose funds that have proven steady over time, you’ll find it much easier to stay invested when the market tests your patience.

How the Two Ideas Connect

• Investors usually stop SIPs when they lose faith in their chosen fund.
• But if you’ve picked funds based on consistency and philosophy, not hype, you’ll have the confidence to keep investing through sideways markets.
• Staying invested is easier when you trust the vehicle carrying your money.

In Ashish’s words, success in investing isn’t about hitting sixes every time, it’s about staying on the pitch long enough.

Final Thoughts

Markets will always have their circus: elections, wars, oil prices, US tariffs—you name it. But none of these should shake your investing discipline.

• Stay invested through the dull and the volatile phases.
• Choose funds based on consistency, not last year’s winners.
• Add more during dips to give yourself an edge.

The true secret of wealth creation isn’t timing the market, it’s time in the market.

Disclaimer

Investments in the securities market are subject to market risks, read all the related documents carefully before investing. The securities are quoted as an example and not as a recommendation.This is nowhere to be considered as an advice, recommendation or solicitation of offer to buy or sell or subscribe for securities. INDStocks SIP / Mini Save is a SIP feature that enables Customer(s) to save a fixed amount on a daily basis to invest in Indian Stock. INDstocks Private Limited (formerly known as INDmoney Private Limited) 616, Level 6, Suncity Success Tower, Sector 65, Gurugram, 122005, SEBI Stock Broking Registration No: INZ000305337, Trading and Clearing Member of NSE (90267, M70042) and BSE, BSE StarMF (6779), SEBI Depository Participant Reg. No. IN-DP-690-2022, Depository Participant ID: CDSL 12095500, Research Analyst Registration No. INH000018948 BSE RA Enlistment No. 6428. Refer https://indstocks.com/pricing?type=indian-stocks; https://www.indstocks.com/page/indian-stocks-sip-terms-and-condition for further details.