Understanding the relative position of the market, the absolute values do not matter much. What matters is what is the earnings multiple, currently the market is trading at, popularly captured by a metric called P/E ( Price to earnings).
As you watch TV or read any business newspapers, you will know about highs in the markets at different points of time. The market keeps on scaling and the party seems to never end. Sometimes you see highs and sometime lows in the market.
So, if you are thinking of entering the investing market and joining the party how do you go about it. Are you worried party may end soon and you will be stuck with a costly investment?
Let's look at some important points. Build a basic model to see if we can understand the impact of investing in very high markets or at the top of a bull run or just before the crash.
Here is the broad process that I normally follow:
To understand how entering into equity mutual funds when markets are high , Let us try to define what does high market mean first.
While absolute value of Nifty or BSE is what you keep on hearing all the time on newspapers and TV. In terms of understanding the relative position of the market, the absolute values do not matter much. What matters is what is the earnings multiple, currently the market is trading at, popularly captured by a metric called P/E or Price to earnings.
SIPs help de-risk my investments and provides superior returns while entering at market highs.
This is my personal opinion only. This is not any professional advice. You can share your investing ideas as well.
We all look to earn good returns on the money we invest. Putting money in High return investments is one way of generating better income. The different places to get good returns are mutual funds, equity, and gold investment in India.
Investing in abroad markets has become quite easy these days. One can get direct and indirect exposure into the U.S. market through various methods. Investing in foreign markets like the U.S provides many benefits like Diversification into the top companies of the world, Benefit of Currency Depreciation, etc. Apart from directly purchasing the stocks listed on the U.S. stock exchanges, there are some different methods as well. Know the best methods of getting exposure to the U.S. stock markets.
The Mirae Asset NYSE FANG Plus ETF Fund is a good option for Investors who want foreign exposure. The Equity allocation is very concentrated to just 10 stocks which makes this ETF very volatile and risky. This ETF consists of the top 10 stocks in their respective sectors mostly TECH, like Amazon, Netflix. Facebook, etc. Hence Investors with high-risk tolerance and a long time period should consider this fund.
There are several investing choices accessible for Indian students that might assist them in beginning their future savings. There are several options for students to build their money and make financial plans, including standard savings accounts, term deposits, and mutual funds.
Fund of Funds has some key advantages such as High Diversification, Low volatility, High accessibility, etc. On the other hand, it also has some drawbacks which include a High Expense ratio, low transparency, and Mediocre returns.
The introduction of Systematic Investment Plan (SIP) in the mutual fund is regarded as one the major breakthrough in the financial sector. It has helped to attract a new class of investors in the sector who were not comfortable to invest a lump sum at a time.
ETFs (Exchange Traded Funds) & Mutual Funds are investment avenues that are managed by a Fund manager and allow Retail investors to invest in them. ETFs are listed on Stock Exchanges, and Mutual Funds are not. Usually, ETFs track an Index or sector whereas Mutual Funds offer a much more variety of Funds from which an investor can choose from. Both of these investment vehicles have their own merits and demerits. One should evaluate their risk profile and goals and choose one of them either. Find out which of these is the better option.
NRIs living in the United States can invest in Indian Mutual Funds, but there are some hassles that have to be overcome. You will require an NRE, NRO, or FCRN account in order to convert the foreign currency into Indian rupees, post which you can complete the KYC and begin investing in Indian Mutual Funds.
Fincash is a yet another online investing platform that was started in 2016 or you can call it a fintech startup. Having raised funding, it has grown fast to give tough competition to other market players.
Funds of Funds are professionally managed funds that invest in several types of funds. Retail investors with limited capital and who are unwilling to take too much risk can invest in such funds. As FoFs are highly diversified, the overall risk is reduced for investors.