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In this higher market which investment pattern is better for one time investment lumpsum STP or SWP

In this higher market which investment pattern is better for one time investment lumpsum STP or SWP and also suggest me better STP fund for 5 year tenure?

Aug 8, 2016 by Paresh Navik, Navsari  |   Mutual Fund

First let us answer your concern about the markets – We at Advisorkhoj, do not think it is at a very high level for the markets. In fact, it is around 10% lesser than that of the previous market high in early 2015. India is actually in a long term bull run phase and it will continue for some more times to come if the economic reform process of the current Government continues for some more years. With passage of GST bill and other progressive legislations, we think, the long term India growth story is intact.

Therefore, if you are a long term investor, please stay invested and invest more as the future looks very bright :)

However, if your assessment says that the current market is high and also if you do want to take much risk, then investing via STP route over 5 years would be ideal. For this, you may invest in a liquid fund and transfer a fixed amount to a diversified equity fund of the same AMC on a weekly basis.

Let us understand this through an example –

Suppose you had invested Rs. 500,000, 5 years back in ICICI Prudential Liquid Fund and transferred Rs. 2,500 per week over 5 years to ICICI Prudential Value Discovery Fund. You would have made a profit of Rs. 112,834 from liquid fund and the corpus value in the equity fund would have been Rs. 10,14,390. Please check the results in detail from the below URL

STP WEEKLY TRANSFER FROM ICICI PRUDENTIAL LIQUID FUND TO ICICI PRUDENTIAL VALUE DISCOVERY FUND

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