If you have carefully taken every step towards investing in the right direction, then here is a reason for you to smile. Investments in the mid and small cap companies have proved far more profitable since that’s the avenue where most diversified funds were invested.
Although the diversified stock funds witnessed a drop of 0.72% since January, investments in mid and small cap stocks saved the day. The reasons for the drop were simple; every investors worry – rising interest rates and high rise inflation. Apart from this growth hampering atmosphere, Indian stocks seemed to have managed pretty well.
If you are an investor who has been investing in the health care and FMCG, you can savor the moment since these stocks have outperformed amidst the volatile market conditions. Due to rising wages and a cut throat competition coupled with uncertain economic conditions abroad, the growth in the IT sector is pretty stagnant.
For conservative investors who look forward for investing in Gold exchange-traded funds(ETFs), the yellow metal reached a record high of Rs23,358/ 10 gms on July 25 from Rs23,174/ 10 grams by July 1. Experts are predicting an upward growth in this investment avenue in future as well.
Investments in debt funds like fixed income funds and government securities have also witnessed a slight increase 0.26% in the month of July.
Apart from all these upward inclination of the markets, as a prudent investor you must always follow the golden rule – “Do not put all your eggs in one basket”. With a tremendous performance of a particular sector should not entice you to save all your investments into them. In the eventuality of a downfall in the market you may end up losing most or even all your investments, if you failed to act with prudence. Settling with the repayment of a debt of a personal loan or a home loan for the next 10-20 years of your life is not something that is desirable.
Although it is necessary that you study the market, timing it is not appropriate. It is as equal as gambling where you can get lucky once or twice and not all the time. Continue investing with prudence and follow the SIP route as it increases your investment discipline by nurturing a goal oriented approach.