Strategies to adopt when the markets are at a high (for new and existing MF investors)

An investor must have a plan in place and, more importantly, stick to it regardless of shifting market conditions.

- Sanjeev Puri

With sufficient liquidity to support the market, the indices are near all-time highs. Markets remain volatile in the short to medium term, but they average out over time. An investor who has witnessed the ups and downs of such a market remains set for the long haul and is mostly unaffected by such frequent oscillations.

Beginners in equity funds face market fluctuations, requiring careful reading of investment and tax documents to understand the risks associated with these funds.

Investors, especially young people, should not be overly concerned about the current market condition. As most market experts say, the current market valuations are at a high but then how much will they fall to is difficult to predict. And, investors need to stay away from any such predictions. Period.

When you are first starting out, it is simpler to commit money for long periods because you have minimal financial commitments and can afford to take chances with your investments. Another advantage of starting early is that you can make mid-course changes without significantly affecting your portfolio. Frequent fluctuations.

Most importantly, mistakes made during the initial days of investing help one learn the basics of investments that come to the rescue in the later stages of life. What course will the market take and how long before it takes a turn again is not something any investor has ever been able to figure out with authority?

For retail mutual funds investors, therefore, here are a few things to look at in these uncertain times.

Stay invested if your goals are more than five years away