Despite continuous declines in the stock market, October saw record investments in Equity Mutual Fund schemes. According to AMFI (Association of Mutual Funds in India) data, investors made a record investment of ₹25,323 crore through SIP, while ₹4,047 crore was invested in New Fund Offers (NFO).
Benefit from Lump Sum Investments During a Market Down
Experts believe that investors see market downturns as an opportunity, especially when Equity Mutual Funds have the potential for better long-term returns. Besides SIP (Systematic Investment Plan) and STP (Systematic Transfer Plan), experts also advise lump sum investments on days of significant declines.
Deepak Jain, President and Head of Sales at Edelweiss Mutual Fund, says that as the market gains momentum, investors’ risk-taking capacity also increases. He believes that with experience, investors are now showing a trend towards investing in more detailed Mutual Fund schemes like sectoral and thematic funds.
Market Declines Can Be Beneficial for SIP Investors
Deepak Jain explains that the current market volatility can be a good opportunity for SIP investors. Although the recent fluctuations in Nifty might seem high, it is still less than 10%, which can be considered normal in the long run. Jain states that investors are now more aware and plan their investments keeping volatility in mind.
Diversify Investments for Profits
Experts advise investors to diversify their investments in various Mutual Funds like Flexi Cap, Large Cap, Mid Cap, and Balanced Advantage Fund (BAF), considering their risk-taking capacity. This strategy can help bring stability to the portfolio and enhance potential returns.
Increased Investment in New Funds
In recent months, there has been an uptick in investments in NFOs, reflecting investors’ tendency to take more risks and try new investment options. Deepak Jain believes that a growing understanding of the market and increasing tolerance for risk have attracted investors towards new products.
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Conclusion
In conclusion, In market up and down, investors can benefit from long-term investments in Equity Mutual Funds by continue SIP and diversified investment strategies for better returns.
I hope this helps! If you need any more assistance, feel free to ask.