,new investors “The market is witnessing high volatility, so be panicked,” said Jujar Gabajiwala, director, Ventura Securities.
“The market is going to be volatile. At present, there is a high level of volatility. New mutual fund investors should understand that they are Investment for the long term. They have to accept volatility and invest regularly,” Gabajiwala said.
High valuations, high inflation, fear of rate hike and reports of resumption of Covid-19 cases in the US and parts of Europe have paralyzed market sentiments.
Market benchmark Nifty 50 is now down over 6% from its all-time high of 18,604 which was hit on October 19 this year.
According to mutual fund advisors, the market may remain volatile in the near future. Investors, especially new investors, should tread carefully.
Rahul Singh said, “Global inflation risk is real and any increase in bond yields will have an impact on equity valuations globally as well as in emerging markets. To address these risks, asset allocation for first time investors is required. becomes extremely important.” , CIO-Equities, Tata Mutual Fund.
Many fund managers and advisors are recommending Balanced Advantage Funds or Dynamic Asset Allocation Funds to new equity mutual fund investors. Funds in this category have given 20.07% returns in the last one year.
“The overall allocation between debt and equity adjustments to the individual risk profile will be important. Furthermore, first time investors should evaluate Balanced Gain Funds as a suitable plan to enter the markets at this stage and their asset allocation. can become a major part of the
Fund managers also underline that Investment in equity mutual funds Typically done for a longer period, new mutual fund investors can use such opportunities to increase exposure to the equity segment. New investors can buy funds focused on bluechip stocks.
“Mutual fund investors can take this correction as an opportunity to enter for the long term. Buying a fund focused on bluechip stocks would be a good idea for new investors,” said Ruchit Jain, Trading Strategist, 5paisa.com.
“First time investors should start with SIP. If an investor wants to make a one-time investment at this point of time, he/she can invest in Balanced Advantage Funds. If an investor is already invested, especially in small cap funds , then he can consider a partial exit as he has had a very good run up,” Gabajiwala said.