Equity benchmark indices Sensex and Nifty continued their record-breaking rally on Friday, reaching new all-time excessive ranges in early commerce. At the time of writing, Nifty 50 was up 68.60 factors at 20,171.70 whereas Sensex was up 234.87 factors to 67,753.87
So, how can mutual fund (MF) buyers take advantage of such conditions when fairness markets are at an all-time excessive? The celebrations at Dalal Street have introduced cheers to the inventory market buyers, consultants counsel that MF buyers mustn’t get carried away to e-book earnings. They ought to religiously proceed with their SIPs, like within the bearish section of the market.
“Just like we see “correction as a celebration” during falling markets and never stop SIP investments, even during rising markets we should continue SIPs because this level could very well be a low point when seen in the future if markets continue to rally. If we book profits and exit, it could become very difficult to enter again at higher levels.” stated Anil Ghelani, Head- Passive Investment and Products, DSP Mutual Fund.
“The Nifty 50 and Sensex have surged to document highs. Investors ought to resist the urge to liquidate all their holdings however think about decreasing their stakes in corporations that seem overvalued or have weak financials. Instead of trying to foretell market peaks and troughs, buyers ought to base their selections on long-term targets and keep away from being swayed by short-term market fluctuations,” said Palka Arora Chopra, Director – Master Capital Services Ltd.
For mutual fund investors, the key is not market timing but the duration of their investments, as this is when the true power of compounding comes into play. “Even in the midst of the current market rally, it is crucial to adhere to your asset allocation strategy and periodically adjust your portfolio to maintain the desired balance,” stated Palka Arora.
Mutual Funds: Strategy for SIP, lump-sum buyers in a bull run
Experts say that over the long run, it’s anticipated that market tendencies will likely be constructive, which is able to finally be advantageous to SIP buyers.
“Given the state of the market, lump-sum buyers would want to proceed cautiously,” said Amit Gupta, MD, Sag Infotech.
Another mistake investors commit is to invest a lump sum during a bull run. “Although the markets are not in a bubble, they are unquestionably pricey. We are not comfortable investing our money in the market in a big amount, at least not right now,” added Gupta.
Disclaimer: The views and proposals made above are these of particular person analysts, and never of Mint. We advise buyers to test with licensed consultants earlier than making any funding selections.
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Updated: 15 Sep 2023, 02:58 PM IST
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