Summary
The volatility in the global and domestic stock markets continues. After the Russia-Ukraine crisis, markets around the world have fallen. Investors are currently pulling back on geopolitical tensions and rising crude oil prices. However, if you invest in equity mutual funds, then you can earn profits at this time, the complete math of which tells the report of Kalicharan-
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Expansion
Expert Balwant Jain says that the ups and downs in the stock market are continuing. The Sensex had lost 2,702 points on the day Russia attacked Ukraine. A day after that, there was a boom in the domestic market. The Sensex lost 3.41 per cent during the last week. In such a situation, if you want to invest in equity mutual funds, then as an investor, you must assess your risk. Equity mutual funds are completely subject to risk and are completely dependent on market risk.
- This means that whenever the market goes down, the portfolio of the investors shrinks, while in the bullish period, they make profits. Therefore, financial discipline is essential for those investing in mutual funds.
- Review the portfolio from time to time along with asset allocation. This not only keeps the investment safe but also gives better returns.
If the market falls, then the emphasis on smallcap
When the market starts a phase of volatility, both the ups and downs affect the units of the mutual fund. However, the impact of largecap funds is less, while smallcaps see more volatility.
Investors can increase or decrease their investment in smallcap, midcap and largecap as volatility increases. When the market declines, you can increase your investment in smallcaps. It can give higher returns when it picks up.
The math of investing right
invest money for long term
The emphasis should be on investing in mutual funds for the long term. In this, the risk is reduced with the return of manifold. Fund review is essential while investing, but doing so on a daily basis adds to the stress. So review your portfolio three to four times in a year. Waiting for a longer period can yield great returns.
There is a rule of ’15 times 15 times 15′ for investing in mutual funds. It suggests that investing in mutual funds for 15 years or more can give returns of up to 15 per cent and become a millionaire. That is, if you invest 15-15 thousand rupees for 15 years, then after 15 years you will get an amount of one crore on maturity.
Do not pretend to sell shares out of fear
In the phase the stock market is going through, investors should not sell their shares out of fear and mindlessness. History is witness, earlier also the market collapsed on several occasions of geo-political tensions and wars, but then also made a rapid comeback. Hence, from an investor’s point of view, indiscriminate selling of shares during any crisis is unwise. This should be done only when it is very necessary, otherwise it can have the opposite effect. Hiren Vaid, director, Alchemy Capital Management