Indian markets at all-time high! What should mutual fund investors do now?
However, with markets hitting all-time high, many mutual funds investors are now wondering whether to book profits or continue with systematic investment plans.
- Jun 29, 2023,
- Updated Jun 29, 2023 10:55 AM IST
Indian markets opened at an all-time high amid robust inflows from foreign investors on the back of improving macroeconomic fundamentals. The 30-share BSE Sensex surged over 500 points to touch a new all-time high of 63,956 in Wednesday's trading session and the NSE Nifty climbed over 160 points or 0.8 per cent to touch its lifetime peak of 18,910.
It's a fact that investing in equities through mutual funds is considered one of the best options. However, with markets hitting all-time high, many mutual funds investors are now wondering whether to book profits or continue with systematic investment plans.
Viral Bhatt, Founder of Money Mantra, says, "If you are thinking about redeeming your mutual funds, it is important to weigh the pros and cons carefully. If you need the money for an unexpected expense, then there is no choice but to redeem your funds. However, if you are selling your funds because you are worried about the market, you may want to reconsider. The market is always volatile, but over time it has always trended upwards. So, if you sell your funds now, you will likely miss out on the gains that come later."
"Many investors are blissfully unaware of the benefits of long-term investing nor do they seek to avail of professional advice. If you don't understand the long-term benefits of investing, then you may want to talk to a financial advisor. A financial advisor can help you understand the risks and rewards of investing and can help you create a plan that meets your individual needs," he added.
How to select the right fund?
"Historically, good funds have given attractive past performance. Any mutual fund in its risk factors will tell you that past performance is not a guarantee of future performance. However, it is seen in most cases that good funds manage to outperform in most market conditions. At least they manage to outperform in the long run," said Bhatt.
"Prefer a fund that is based a lot more on the process and rules than a fund that is based entirely on the discretion of the fund manager," he added.
He also highlighted that the most important step in picking the best mutual funds is to focus on getting the mutual funds that fit your needs. Once that is done, the second step is to evaluate alternate options. You need to create a mutual fund portfolio that has the right mix of equity funds, and debt funds.
However, Bhatt pointed out that investors should avoid a fund that is seeing a lot of churn in senior personnel like CEOs, CIOs, fund managers etc.
Also Read: Infosys, TCS, Wipro, TechM, Mphasis shares: IT stocks that analysts like ahead of Q1 results
Also Watch: Bank Holiday June 2023: Banks to remain closed on June 29 in these states for Eid Al Adha (Bakri Eid)
Indian markets opened at an all-time high amid robust inflows from foreign investors on the back of improving macroeconomic fundamentals. The 30-share BSE Sensex surged over 500 points to touch a new all-time high of 63,956 in Wednesday's trading session and the NSE Nifty climbed over 160 points or 0.8 per cent to touch its lifetime peak of 18,910.
It's a fact that investing in equities through mutual funds is considered one of the best options. However, with markets hitting all-time high, many mutual funds investors are now wondering whether to book profits or continue with systematic investment plans.
Viral Bhatt, Founder of Money Mantra, says, "If you are thinking about redeeming your mutual funds, it is important to weigh the pros and cons carefully. If you need the money for an unexpected expense, then there is no choice but to redeem your funds. However, if you are selling your funds because you are worried about the market, you may want to reconsider. The market is always volatile, but over time it has always trended upwards. So, if you sell your funds now, you will likely miss out on the gains that come later."
"Many investors are blissfully unaware of the benefits of long-term investing nor do they seek to avail of professional advice. If you don't understand the long-term benefits of investing, then you may want to talk to a financial advisor. A financial advisor can help you understand the risks and rewards of investing and can help you create a plan that meets your individual needs," he added.
How to select the right fund?
"Historically, good funds have given attractive past performance. Any mutual fund in its risk factors will tell you that past performance is not a guarantee of future performance. However, it is seen in most cases that good funds manage to outperform in most market conditions. At least they manage to outperform in the long run," said Bhatt.
"Prefer a fund that is based a lot more on the process and rules than a fund that is based entirely on the discretion of the fund manager," he added.
He also highlighted that the most important step in picking the best mutual funds is to focus on getting the mutual funds that fit your needs. Once that is done, the second step is to evaluate alternate options. You need to create a mutual fund portfolio that has the right mix of equity funds, and debt funds.
However, Bhatt pointed out that investors should avoid a fund that is seeing a lot of churn in senior personnel like CEOs, CIOs, fund managers etc.
Also Read: Infosys, TCS, Wipro, TechM, Mphasis shares: IT stocks that analysts like ahead of Q1 results
Also Watch: Bank Holiday June 2023: Banks to remain closed on June 29 in these states for Eid Al Adha (Bakri Eid)