I tested 108 versions of a buy-the-dip strategy

The pitch behind most "smart SIP" strategies fits on a slide: keep investing monthly, but when the market falls hard, move some money to safety and buy back in once things settle. I wanted to know whether it actually worked, under which exact rules, and by how much.

The setup

Every month ₹1 lakh goes into the index. If the index falls more than a set percentage from its peak, part of the holding moves to a liquid fund earning 6%. Money returns either when the index recovers to its previous high, or when the fall passes a deeper threshold that marks it as a crash worth buying into.

I tested six sell triggers, six buy-back triggers, and three different amounts to move — 108 combinations, each a full 257-month simulation on the same index data.

What won

Selling at a 20% fall, buying back once the fall passed 35%, moving 70% of the holding each time: 23.08% a year, against 21.47% for plain monthly investing. On ₹2.57 crore invested over twenty years, that gap is worth roughly ₹9.5 crore.

The same 20% / 35% pair also won at the other two amounts moved, which is mildly reassuring — a setting that survives a change in another dimension is less likely to be pure coincidence.

Why I don't fully trust it

The edge lives in three events. Outside 2008, 2020 and one large 2025 move, the strategy and plain investing track each other almost exactly. A rule that earns its keep three times in twenty years has not been tested very often.

Most combinations lost. Only 11 of 36 beat plain investing at the middle setting. If you'd picked thresholds without the benefit of hindsight, the odds were against you.

The surface is bumpy. A genuinely robust rule usually sits inside a broad region of similar results. Here, moving one setting over could cost more than a percentage point.

The data has error in it. The index series was read from a chart image, not an official feed. Near a 20% or 35% threshold, a small reading error can move a trade by a month — and the entire strategy is built out of threshold crossings.

Costs aren't modelled. No exit loads, no short-term capital gains tax. The winning variant made a single move of ₹29.8 crore. Taxed, that changes the picture.

What I'd take from it

Not "use 20% and 35%." More like: a disciplined de-risking rule can beat doing nothing, but the benefit is smaller and less reliable than the headline number suggests, and most versions of the idea don't beat simply continuing to invest. The sheet is free — the useful exercise is changing the thresholds yourself and watching how quickly the advantage disappears.

Nothing here is investment advice. See the disclaimer.