Optimal incremental SIP contribution pattern for maximizing compounded returns

Identify the optimal schedule for incremental monthly Systematic Investment Plan contributions—comparing fixed contributions with progressive increases—that maximizes long-term compounded returns for equity index SIPs such as those tracking the Nifty 50.

Background

Beyond timing, contribution schedules can materially influence terminal wealth through compounding and sequence-of-returns effects. The paper focuses on timing but acknowledges that the best structure for incrementing monthly contributions remains unresolved.

Determining an optimal contribution path would inform practical plan design for retail investors and financial planners seeking to enhance long-horizon outcomes without complex timing strategies.