Nifty up 13% from April's low. How should mutual fund investors alter their investment strategy?
Nifty
50 up nearly 13% from April's low and touching 25,001 on Monday, market experts note that while many investors may consider profit booking, mutual fund investors, particularly those with a long-term outlook, are advised to stay invested. The recent highs reflect strong underlying earnings growth, supportive macro factors, and positive investor sentiment, rather than a signal to exit.
'Timing the market is challenging, and exiting prematurely could mean missing out on further upside or the power of compounding. That said, investors should use this opportunity to review their asset allocation and rebalance if their equity exposure has gone significantly above their target levels. Booking partial profits and reallocating to underweight asset classes, such as debt or gold, could be considered purely from an asset allocation standpoint—not as a reaction to the index level,' said Sagar Shinde, VP Research, Fisdom.
Also Read |
Nifty still below peak, but why are these mutual funds at record-high NAVs?
Play Video
Pause
Skip Backward
Skip Forward
Unmute
Current Time
0:00
/
Duration
0:00
Loaded
:
0%
0:00
Stream Type
LIVE
Seek to live, currently behind live
LIVE
Remaining Time
-
0:00
1x
Playback Rate
Chapters
Chapters
Descriptions
descriptions off
, selected
Captions
captions settings
, opens captions settings dialog
captions off
, selected
Audio Track
default
, selected
Picture-in-Picture
Fullscreen
This is a modal window.
Beginning of dialog window. Escape will cancel and close the window.
Text
Color
White
Black
Red
Green
Blue
Yellow
Magenta
Cyan
Opacity
Opaque
Semi-Transparent
Text Background
Color
Black
White
Red
Green
Blue
Yellow
Magenta
Cyan
Opacity
Opaque
Semi-Transparent
Transparent
Caption Area Background
Color
Black
White
Red
Green
Blue
Yellow
Magenta
Cyan
Opacity
Transparent
Semi-Transparent
Opaque
Font Size
50%
75%
100%
125%
150%
175%
200%
300%
400%
Text Edge Style
None
Raised
Depressed
Uniform
Drop shadow
Font Family
Proportional Sans-Serif
Monospace Sans-Serif
Proportional Serif
Monospace Serif
Casual
Script
Small Caps
Reset
restore all settings to the default values
Done
Close Modal Dialog
End of dialog window.
Best MF to invest
Looking for the best mutual funds to invest? Here are our recommendations.
View
Details
»
by Taboola
by Taboola
Sponsored Links
Sponsored Links
Promoted Links
Promoted Links
You May Like
3BHK Transformation Possible for ₹4.5 Lakh?
HomeLane
Get Quote
Undo
Another expert advocates the same opinion that unless one has short-term financial needs or the portfolio has deviated significantly from the defined asset allocation targets, staying invested is the wiser choice for long-term wealth creation, as the Indian economy remains on a strong footing, supported by robust earnings, government reforms, and macroeconomic stability.
'For long-term investors, trying to time the market based on index levels often results in missed opportunities. Instead of exiting the market entirely, consider rebalancing your portfolio—trim some exposure in overvalued sectors or schemes and reallocate towards laggards or more balanced options if needed. This allows you to capture gains while keeping your investments aligned with your financial goals,' recommends Adhil Shetty, CEO of Bankbazaar.com
Live Events
The index stood at 22,161.6 on April 7, marking the lowest level in the current financial year so far. Over the past three months, it has risen by 10.22%, while its six-month gain stands at 2.60%. The Nifty 50 has gained 8.25% over the last year and 5.11% so far in the current calendar year.
Nifty50
touched its 52-week high level on September 27, 2024 of 26,277 and is currently down by nearly 5% from its 52-week high level.
As the benchmark index rises, experts recommend that investors continue their SIPs but exercise caution with lump-sum investments, advising them to stagger these investments over time.
Shetty of Bankbazaar recommends that
SIP
(Systematic Investment Plan) investors should continue their regular contributions regardless of market levels as SIPs are designed to eliminate the need for market timing by investing a fixed amount at regular intervals, which helps average out the cost of units over time and this approach works particularly well during volatile or high market phases, as it ensures discipline and allows investors to benefit from market corrections through rupee cost averaging.
'On the other hand, investors with lump-sum amounts should be cautious when the market is at all-time highs. Rather than deploying the full amount at once, consider a staggered investment strategy—spread the investment over 3 to 6 months or even longer through Systematic Transfer Plans (STPs) into an equity fund. Alternatively, deploying the lump sum can offer exposure to equities while managing downside risks. This measured approach helps reduce regret from potential short-term corrections and aligns better with long-term wealth-building goals,' he added.
Also Read |
30 equity mutual funds multiply lumpsum investments by over 2 times in 3 years
To continue with the SIPs in the current market scenario, Shinde adds that lump-sum investors, however, should adopt a staggered approach as deploying the entire amount at current levels could expose them to short-term volatility.
'A Systematic Transfer Plan (STP)—where the lump sum is parked in a liquid or ultra-short duration fund and gradually moved into equities—can be an effective method to mitigate timing risks. Alternatively, if the investor has a medium- to long-term horizon, partial deployment in balanced advantage or multi-asset funds can serve as a middle ground, offering market participation with downside buffers,' Shinde adds.
ETMutualFunds looked at the performance of equity mutual fund categories since the April low and found that out of 21 categories, 19 offered double-digit average returns and two gave single-digit returns in the same time frame.
Since April 7, the
Auto sector
based funds offered the highest average return of 18.30%, followed by technology based funds which gave 17.04% average return in the same period.
International funds
gave 16.07% and infrastructure funds gave 14.86% average return in the same period.
Midcap and smallcap funds gave 14.82% and 14.71% respectively since April's low level. Contra and largecap funds were last in the list of double-digit gainers. The categories gave 11.77% and 11.22% respectively in the mentioned period.
Consumption based funds and pharma and healthcare funds gave 9.83% and 8.50% average returns respectively in the mentioned period.
Post the categories gaining in double-digits and market above 25,000 mark, Shinde advices investors fresh investments at market highs should be made with a margin of safety and diversification in mind and for new investors, it's important not to shy away from equity markets entirely—rather, the focus should be on how and where to deploy capital.
Also Read |
Planning to invest Rs 10 lakh for up to 2 years? Shiv Gupta of Sanctum Wealth recommends this
'Conservative hybrid funds or balanced advantage funds (BAFs) offer a prudent starting point. These funds dynamically manage equity exposure based on valuations and volatility, making them ideal for entry during elevated market levels'
'Flexi-cap and multi-cap funds are also well-suited for long-term investors due to their allocation flexibility across market capitalisations. For global diversification, international funds—especially those focused on US or developed markets—are also attractive, given their recent rebound and long-term growth potential. In short, invest, but do it with a category that aligns with your risk appetite & time horizons,' he further added.
On the similar lines, Shetty advices that quality-focused index funds that invest in fundamentally strong companies can offer consistent returns with relatively lower risk and the key is to match the investment horizon and risk tolerance with the right fund category and investing through SIPs or staggering the investment through STPs (Systematic Transfer Plans) can further reduce timing-related risks.
'Investing at market highs requires a disciplined and cautious approach, especially for new investors who may be concerned about near-term corrections. Rather than shying away from investing altogether, new entrants can consider fund categories that offer built-in risk mitigation and asset allocation flexibility. Quality-focused index funds that invest in fundamentally strong companies can offer consistent returns with relatively lower risk. The key is to match your investment horizon and risk tolerance with the right fund category. Investing through SIPs or staggering the investment through STPs (Systematic Transfer Plans) can further reduce timing-related risks,' the CEO of Bankbazaar advised.
One should always consider risk appetite, investment horizon, and goals before making investment decisions.
(
Disclaimer
: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
If you have any mutual fund queries, message on ET
Mutual Funds
on Facebook/Twitter. We will get it answered by our panel of experts. Do share your questions on
ETMFqueries@timesinternet.in
alongwith your age, risk profile, and Twitter handle.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Indian Express
20 minutes ago
- Indian Express
Govt to highlight UP's cultural, spiritual & natural diversity at Japan Tourism Expo in Sept
The state government is preparing to showcase the state's cultural, spiritual, and natural diversity at Japan Tourism Expo 2025, scheduled from September 25 to 28. The Uttar Pradesh Tourism Department will participate and highlight the state's heritage to a global audience, particularly visitors from Japan and the Asia-Pacific region, a statement issued on Wednesday said. A themed pavilion spanning 54 square metres will be set up at the venue. This space will offer immersive glimpses into Uttar Pradesh's cultural richness to captivate international tourists and investors alike. Parallelly, the third edition of the Uttar Pradesh International Trade Show (UPITS-2025) will also reflect the state's vibrant heritage. A 465-square-metre pavilion at India Expo Centre and Mart in Greater Noida will host live demonstrations of traditional folk art, classical dances, and showcases of the famed Buddhist circuit — all curated to draw attention from global visitors. Beyond tourism promotion, the move also aligns with strengthening Indo-Japanese economic ties. In 2023–24, the government stated, India exported goods worth Rs 42,800 crore to Japan, including engineering goods, chemicals, and pharmaceuticals. In return, imports from Japan totaled Rs 1.47 lakh crore, dominated by electronics, advanced machinery, and rare-earth materials. The UP government looks forward to attracting investment in the state's tourism sector, particularly in heritage hotels, wellness centres, and eco-resorts under the PPP model — sectors increasingly attractive to Japanese investors. The government also claimed that 2.4 lakh Japanese tourists visited India in 2024, contributing approximately Rs 1,200 crore to the Indian economy. These tourists stayed an average of 16.3 days, spending about Rs 1.45 lakh per person. In contrast, 2.33 lakh Indian tourists travelled to Japan, spending roughly ¥56.1 billion (Rs 3,366 crore). Recognizing this mutual tourism potential, the government aims to strategically position Uttar Pradesh not only as an attractive investment destination but also as a 'most favored tourist destination' for Japanese travelers. At the Japan Tourism Expo, information about Uttar Pradesh's top tourist destinations will be shared with Japanese visitors. To make this easier, special booklets will be printed in both English and Japanese. Visitors will also be able to access details and make bookings through the UP Tourism Department's mobile app. A major focus will be on the Buddhist Circuit (Sarnath, Kushinagar, Shravasti, Kaushambi, Sankisa, and Kapilvastu), which is expected to attract Japanese Buddhist tourists. In addition, Ayurveda, Yoga, Naturopathy, and Rural Tourism will be promoted to match the health and spiritual interests of Japanese travelers. The UP pavilion will use advanced technology like digital LED screens, auto-navigation displays, and AR-based selfie panels to offer an immersive experience. Visitors will also get a glimpse of the state's handicrafts, culture, music and festivals, enriching their overall experience, said the statement.
The Hindu
20 minutes ago
- The Hindu
India, U.K. to sign free trade agreement on July 24 in London
India and the U.K. will sign a free trade agreement on Thursday (July 24, 2025) in London that will allow export of labour-intensive products such as leather, footwear and clothing at concessional rates, while making imports of whisky and cars from Britain cheaper. The pact also helps double trade between the two economies to $120 billion by 2030. Also Read: Caution and optimism: On India's FTA with the United Kingdom The pact, officially called a comprehensive economic and trade agreement, will be signed in the presence of Prime Minister Narendra Modi and British Prime Minister Keir Starmer. Commerce and Industry Minister Piyush Goyal and his British counterpart Jonathan Reynolds would sign the agreement. Once the pact is signed, it will require approval from the British Parliament before it can take effect. The process may take about a year. PM Modi on Wednesday (July 23, 2025) left on a four-day visit to the U.K. and the Maldives. The two countries announced the conclusion of the negotiations for the trade agreement on May 6. The pact has chapters on issues including goods, services, innovation, government procurement, and intellectual property rights. The two countries have also concluded the negotiations for the Double Contribution Convention Agreement, or social security pact. It would help avoid double contribution to social security funds by Indian professionals working for a limited period in Britain. In such trade agreements, two countries either eliminate or significantly reduce customs duties on maximum goods traded between them. They also ease norms for promoting trade in services and bilateral investments. Under the pact, 99% of Indian exports would benefit from zero duty in the U.K. market. The main proposals of the agreement include slashing of import duty on British Whisky and gin from 150% to 75% before reducing to 40% by ten years of the deal; automotive tariffs will be reduced from over 100% to 10% under a quota. Other goods with reduced import duties, which can open markets and make trade cheaper for businesses and Indian consumers, include cosmetics, aerospace, lamb, medical devices, salmon, electrical machinery, soft drinks, chocolate and biscuits. It will open export opportunities for domestic labour-intensive sectors such as textiles, marine products, leather, footwear, sports goods and toys, gems and jewellery, engineering goods, auto parts and engines, and organic chemicals. On the services front, the agreement eases mobility for professionals including Contractual Service Suppliers; Business Visitors; Investors; Intra-Corporate Transferees; partners and dependent children of Intra-Corporate Transferees with right to work; and Independent Professionals like yoga instructors, musicians and chefs. India's exports to the U.K. rose by 12.6% to $14.5 billion, while imports grew by 2.3% to $8.6 billion in 2024-25. The bilateral trade between India and the U.K. increased to $21.34 billion in 2023-24 from $20.36 billion in 2022-23.
&w=3840&q=100)
Business Standard
20 minutes ago
- Business Standard
Railways gave 45% subsidy on passenger travel in FY24, says govt
The Indian Railways provisionally spent ₹60,466 crore in subsidy, 45 per cent of the cost of passenger travel, in the financial year 2023-24, the Centre informed the Lok Sabha on Wednesday. Railway Minister Ashwini Vaishnaw gave the information in response to the questions raised by several MPs on the recent rail fare hike. Vaishnaw said the Indian Railways provides affordable transportation service to more than 720 crore passengers and its fares are among the lowest in the world, even when compared with neighbouring countries. "The total amount of subsidy given in FY 2023-24 on passenger travel is provisionally estimated at ₹60,466 Crore. This amounts to a 45 per cent subsidy on the cost of passenger travel," Vaishnaw informed the lower house in a written reply. He said the rail fares were "rationalized" with effect from July 1 this year after a gap of more than five years. "The increase in fares is very low, ranging from half paise per km to two paise per km for premium classes," he added. The minister said no fare has been increased in the second class ordinary up to 500 km, beyond that, the hike is just half paisa per passenger per kilometre. A half paisa increase has been effected in fare per passenger per kilometre in sleeper class, ordinary and first-class ordinary, 1 paisa increase per passenger per kilometre in non-AC classes in Mail Express, and 2 paisa increase per passenger per kilometre in reserved AC classes, he said. "To maintain affordability for low and middle income families, the fares for MST (Monthly Season Ticket) and Suburban travel have not been revised," Vaishnaw informed the House, saying the hike was insignificant. "It is estimated that less than half the trips will have a marginal increase in fare. For example, for a low-income traveller in general coach, there is no fare increase for 500 km travel," he said. Vaishnaw said the Railways has, to improve the suburban infrastructure and safety, begun work on network expansion and track upgradation, etc. "Further, increase in frequency of train services, including suburban train services, is an on-going process over Indian railways subject to operational feasibility, traffic justification and availability of resources, etc," the minister added.
