But before you join the buy-the-dip brigade and invest your hard-earned money in riskier assets in a volatile market, it is imperative to figure out the right asset allocation strategy. ET Markets reached out to various experts to find out what is the best way to invest Rs 10 lakh at a time when Nifty is nearing 52-week low and near-term outlook remains grim .
Most experts suggest that long-term investors should bet on high-risk stocks as the pain seems to be easing in the medium to long term.
How to invest Rs 10 lakh at this stage:
Dr. Joseph Thomas, Head of Research, MK Wealth Management
For an investor who is moderately aggressive, 60 per cent can be invested in equities and the remaining in very short term debt with an option to redeploy another 20 per cent very short debt in equities over the next two to three months. could.
Sunil Damania, CIO, MarketsMojo
We recommend a portfolio approach with appropriate allocation for largecap, midcap and smallcap market mix based on your risk appetite.
Also, you want sector exposure, no more than 30 percent in a single sector. This can help in diversifying your portfolio without taking too much risk while investing Rs 10 lakh.
Hence, we suggest selecting 10-12 stocks from different sectors and market caps to build a portfolio for yourself.
Amit Jain, Co-Founder, Ashika Global Family Office Services
40 percent should be invested in banking sector, 30 percent in IT stocks and 30 percent in pharma sector. Choose quality stocks. This weightage can help investors create a much higher alpha than any other sectoral weightage.
Prakash Gadani, CEO, 5paisa.com
The valuations have become fair after the recent correction but near-term risks remain high due to a weak global outlook. Thus, if one wants to make a fresh start, one can allocate 60 per cent in equities and 40 per cent in bonds at current levels.
However, if the market corrects further, there should be a gradual increase in allocation to equities at lower levels which will be beneficial in the long run. So it should not be a one time activity but investors should review the markets from time to time and make necessary changes accordingly.
Sonam Srivastava, founder of Wright Research
A high-risk investor may have a 15 percent fixed income allocation along with equities. A moderate risk investor can work with a 25-30 per cent allocation in fixed income and bonds, while a conservative investor can look at a 50-60 per cent fixed income allocation.
FYERS. Gopal Kavalireddy, Head of Research in
Regardless of the environment, it is imperative that investors focus on time-tested principles of asset allocation based on risk profile, financial capabilities and investment goals. The first and foremost guideline to be followed by any investor is to understand his/her risk profile, and determine whether he/she is a conservative investor, a moderate investor or an aggressive investor.
Based on this, a suitable asset allocation based on the investment horizon can be arrived at.
(Disclaimer: Recommendations, suggestions, views and opinions given by experts are their own. They do not represent the views of The Economic Times)