Prajna Capital - An Investment Guide

Investing a lump sum in stock markets is always a difficult decision. The concern that most have: What if the savings are lost? For investing a lump sum, follow a definite strategy. Let us take the example of a 35-year-old with a corpus of Rs 5 lakh. He has three options. He can invest the amount in stocks, mutual funds, or a mix of both. Investing a large sum in stocks: The first thing any wealth manager will suggest is investing in a staggered manner. Putting the entire amount at one go can sometimes hurt. So, go for the right stocks and then, start investing in parts. Given that the result season is round the corner, I will invest the person ' s money in the next couple of weeks, ideally, at a 60-40 or 50-50 ratio in large-cap and mid-cap stocks, depending on the risk-profile. The risky part of the equity portfolio can be 10-30 per cent (Rs 50,000Rs 1.5 lakh), that can be used to play the market. There is a strategic part of the portfolio, where the money would earn long-term r...