Avoid timing the market with lump-sum investments

Fund houses are restricting such investments; heed the signal and stick to SIPs and STPs

IDFC Mutual Fund is the latest fund house to join the ranks of those which have restricted heavy lump-sum investments in their funds. It has limited lump-sum investment in IDFC Focused Equity Fund to Rs 2 lakh a day. Similar restrictions have been imposed in the recent past in other funds: DSP BlackRock Micro Cap, Edelweiss Tax Advantage, L&T Emerging Businesses, and SBI Small and Midcap Fund. Investors should heed the message in these measures being taken by fund houses and avoid lump-sum investments at a time when valuations are high.  

Some fund houses are imposing restrictions because they