Mutual Fund Strategy: After the budget, the stock market rally continues. In this sequence, the Sensex crossed the level of 51000 for the first time on 5 February. At the same time, Nifty has also been successful in breaking the level of 15000. See, the market valuation is very high. In the midst of high valuation of the market, investors are looking for quality stocks, while those who invest in equity mutual funds are getting confused about new investments. However, experts say that the bull run that is going on in the market can last more than 1 year with the correction in between. The economy is recovering rapidly after the Corona epidemic. At the same time, GDP is projected to grow in double-digit in the next fiscal year. In such a situation, what should mutual fund investors do amid the bull run in the market?
Pay attention to asset allocation
Mahendra Jajoo, CIO, Fixed Income, Mirae Asset Management India, says that the RBI policy has retained the adjunctive stance to support recovery. At the same time, it has also been indicated that adequate liquidity will be maintained in the system. This may lead to some further rise in the bond yield, although it will not affect the recovery of the economy. In such a situation, he says, investors should take care of asset allocation strategy and invest for a long period. He also says that there cannot be any further correction in the market.
Shop every fall
BPN Fincap Director AK Nigam believes that the stock market rally is not going to stop. It can last for 1 to 2 years, although there is no denial of correction in between. He says that for long term taxes, whenever there is the correction in the market or there is little space, investors should make additional purchases in equity funds. However, also keep in mind that invest for at least 5 years. In the long term, the outlook of the market looks very strong.
Which investors should invest where
The corporation says that at present, the midcap and smallcap are looking better. If the investor is aggressive, then they should invest in midcap and smallcap now. At the domestic level, as the economy picks up, small and medium companies will do well. Midcap and Smallcap are recovering after long pressure, but they are yet to gain momentum.
At the same time, if investors do not want to take too much risk in the market, then they should focus on the lodge and midcap segment. Here the risk is reduced by investing in companies with both market cap and midcap. The fear of a big fall is low in large-cap companies. On the large-cap fund, he says that there has been a lot of growth in them already. Many top companies of Sensex and Nifty are at their record highs. In such a situation, you should avoid putting money in LORGCAP right now.
Opinion on debt fund
Experts say that negative returns have started coming in debt mutual funds. The reason behind this is that the bond yield is increasing at this time and it has gone beyond 6 per cent. The rise in bond yields means that the returns in the debt segment will be weak. He says that debt funds are under pressure for mid-term. So it is better to stay away from them.