Planning for FY25, making safe investments: Top personal finance stories
Our top stop stories this week tell how you how to review your portfolio and what to do if you are a risk-averse investor
 "Planning for FY25, making safe investments: Top personal finance stories")
The end of the financial year is a good time to review your investment portfolio and correct course. In this week’s lead story, Sanjay Kumar Singh and Karthik Jerome explain how to rebalance the portfolio and make it shipshape for the coming year.
Today everyone around us is an equity investor. But what if you belong to that class of people who are risk averse and would lose sleep if their portfolio goes down by 5-10 per cent? Should you follow the herd and invest in equities? Deepesh Raghaw, a Sebi-registered investment advisor, suggests the way out for these investors.
Midcap funds have given good returns over the past year, averaging 55.6 per cent. If you are a new investor in the market, you may still enter this category, provided you take limited exposure, have an investment horizon of seven years or more, and take the SIP route. If you are searching for a fund from this category, look up Morningstar’s review of SBI Magnum Midcap Fund.
Are you a 30-year-old, living in a metro city, and looking to buy health insurance coverage of Rs 10 lakh? Look up Policybazaar.com’s table to compare the features and pricing of leading insurers.
Number of the week
Rs 46,200 crore: Lump-sum inflows into equity mutual funds between September 2023 and February 2024
Investors put Rs 46,200 crore in equity mutual funds in the six months ended February 2024. This is thrice the flow received during the previous six months.
While an increase in SIP (systematic investment plans) is laudable, the spike in lump-sum investments, especially at a time when the markets have been running up, is not a happy development. It poses significant risks. Most of these investors hope to reap high returns in a short period. In current conditions, a large part of this money is likely to have gone into smallcap and midcap stocks, whose valuations are already on the higher side after a huge run-up.
If the trend within the market were to reverse, these investors could face significant losses. Many of them are new entrants in the equity market. They would lack the patience and finance to wait until the markets recover. Many of them are likely to throw in the towel and convert their notional losses into actual losses. Taking the systematic investment plan route would be much safer.