Should I invest a lumpsum of Rs 2 lakh at this point?

I want to invest a lumpsum of Rs 2 lakh in mutual funds for at least five years. My goal is to get high returns. Could you please suggest me which funds I should invest? Is it a right decision to invest a lumpsum?
--Satendra Gupta

Harpreet Singh, a Certified Financial Planner, responds:


The equity market being at a high currently can mark the chances of a fall soon. While investing a lumpsum amount, timing becomes critical. I suggest investing in a debt fund and systematically switching the funds from debt to equity in next 24-36 months. Meanwhile, if there is a correction, you can transfer your money to equity funds.

For higher returns, equity funds are a good option. However, equities follow long term bull and bear market cycles. Five years is a good time. It is although advisable to keep a horizon of seven to 10 years.

Seek help of a qualified financial planner to determine the exact funds to invest in and to execute the given advise.

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