This decision depends upon a few things. I will list a couple:-
1.) What is your perception about financial markets in your time span of investments?
2.) What kind of returns are you expecting?
3.) How much liquidity do you have to take care of your daily/monthly expenses?
1.)If your perception about financial markets is weak for the near future, do not invest all your money in a mutual fund at 1 time. Because, if the market falls drastically, chances are that your fund will also lose a lot of money and the NAV will go down. On the other hand, if you think it is strong, go ahead and invest all at one time.
2.) If you are expecting very high returns in a short time frame, then SIP might not be a very good option as you are only investing a portion of your money. So, if the market goes higher, then you will make money only on what you have invested till date and also buy into the fund in the upcoming month at a higher rate( So you will get less units).
3.) If you put all your money into a mutual fund, will you have enough money to take care of your daily needs and emergencies? The worst thing about an investment is putting in all what you have and then being forced to sell in a bear market at a lower rate because you really require the money. Other option is taking a personal loan(15-16%) and taking care of your daily needs, but that would not make sense either as the average return that you can expect from a mutual fund in India is 12-13%.
1.) If you have money to spare and think the market is going to go higher, a mutual fund is a better option.
2.) If you have the money to spare and think that the market is going to fall, DON'T DO ANYTHING!.(It is always better to be even than lose).
3.) If you don't have the money and don't know about markets, but want to be part of it, then you can invest in an SIP because the advantages of this are if the market goes high, you make money on what you've put it, and if the market falls, you get to buy more units of the fund for a cheaper price. Eventually, you can expect to make a return of 14-15% on these, but again, INVESTMENTS ARE SUBJECT TO MARKET RISK!
Please watch the funds average return over the last 10 years and their portfolio holdings.
All the best!:)
PS:- I am assuming you are talking about equity funds.