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Should I invest when the markets are now at high level

I want to have a lump sum investment of Rs. 250000 in Multicap fund. Please advise me that lump sum investment is right or wrong at this time because Sensex is touching so high. Please advise me about some funds also?

May 16, 2017 by R K Singh, Chennai  |   Mutual Fund

Please see our article on Top Performing Multicap funds. You can select one or two funds from our selection for your investment. Regarding your question whether it is wise to invest in equity mutual funds at a time when Sensex is at all time high, we will say that, Sensex was at all time highs at numerous points of time in its history and yet it made new highs; that is the nature of equity market. If you have a very long investment horizon, then investing at all time high should not be a problem, because given the India economic growth story and economic reforms instituted by the Government, equities should scale higher highs in the future.

Over a shorter investment time-frame however, investing at all time highs has some volatility associated risks. Therefore, if you have less than a 3 to 5 year investment horizon, you may want to invest in equity funds through the Systematic Transfer Plan (STP) route, so that you can take advantage of the volatility. Please note that when you are investing through STP route, you should track the market regularly and if you see a strong upward trend, then you should transfer immediately from low risk funds to equity funds.

Hope the above helps! Thanks for writing to Advisorkhoj.

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