When investing, don't select fund based on short-term outperformance alone

As the market rally turns narrow, investors should avoid jumping from their current funds into those that have outperformed lately

On August 28, the BSE Sensex closed at a lifetime high of 38,896. Year-to-date (YTD) it is up 8.39 per cent. The midcap and smallcap segments, which were market favourites until last year, have underperformed year-to-date. The S&P BSE Midcap Index is down 9.72 per cent while the S&P BSE Smallcap is down 14.49 per cent. Meanwhile, there are ominous signs emanating from abroad. Currencies of various emerging markets like Turkey and Argentina have depreciated sharply against the US dollar. India's GDP growth rate for the first quarter of 2018-19 was high at 8.2 per cent. But the rupee has