The first part of the question -The basic answer to that would be that markets performed better over the past 1 year when in comparison to 3 years.This could possibly be due to market sentiments changing over the past 1 year and market rallying.But when we look at a longer time period, say 3 years, the returns are smoothed out as the longer period would have seen both highs and lows of the market and therefore compensate the lows with the highs.Let's look at an example for better understanding, markets didnu2019t perform very well in 2023. So if you look at a return for the period 2010-2023 it could possibly be higher when compared to the returns of the period 2008-2011. This would only happen because, 2010-2023 would be looking at just the +ve returns, whereas 2008-2023 will embrace the u2013ve returns of 2023 also, automatically reducing the total return.This being said, we can even have a case the other way around, where 1-year returns would be lower than 3 years return, the reason being vice versa of what is stated above.To answer the second part u2013Note: Option 2 % change is comparatively higher because of the investment timing. It was done when the price was at the lowest. Also, the time for which the investment was made is only 4 months.Therefore, if you can watch and predict the market this well, option 2 will certainly yield you higher returns.But at the same time, if you wouldu2019ve invested the lump-sum in November, your return till 31st December would be meager 5.88%.Therefore, SIP is the safest bet as you can see that it normalizes the returns. You might not be getting the maximum possible return, but you donu2019t need to even worry about getting the minimum possible return either.Disclaimer: All the calculations are based on Price/Unit assumptions which change according to the market.