BUY, hold or sell?
When will the markets recover?
Shall I stick to fixed deposits or invest in stocks?
Financial advisor, PV Subramanyam, answered these and many more reader queries on stocks, mutual funds, insurance and deposits, in a live chat on IBNLive.com. (Also read: PV Subramanyam's blog)
wealth brings you excerpts from the chat.
On stocks and funds:
Anita: I had invested Rs 15 lakh in equity funds in 2006. Now, the NAV has come down by almost 50 per cent. How long will it take to recover at least my capital and get returns?
PV Subramanyam: In case you have monies to invest, you should continue your SIPs. Your question regarding timing is difficult to answer!
Anita: Is it safe to invest in a debt fund right now? Should I stop investing in funds altogether and only put my money in FDs?
PV Subramanyam: It depends on your tax slab. You can invest in floater, liquid schemes and good quality FMPs. Income funds are ok if you think that interest rates have peaked. As for investing only in FDs, it’s a difficult view to take.
Hansa: Is the right time to enter the share market for novices?
PV Subramanyam: Anytime is a good time if you know what you are doing. Start a SIP in a good fund, have a five-seven year view and pray to God!
Siva Perumal: I have invested around Rs 90,000 in stocks of a premier construction company. In a month’s time, my portfolio now stands with an unrealized loss of 54 per cent. I am trying to average the price by buying more shares when the price goes down. Is it right to do so or shall I exit, with a huge loss?
PV Subramanyam: Just stay with your losses. If it is a good company, prices will recover; if it is a bad company, it will just disappear. So, selling might make sense. Always stick to a mutual fund -- the spread of risk will benefit you.
Preetam: I have just begun my career. Should I invest in shares now or go for bank FDs?
PV Subramanyam: You should invest in shares through exchange-traded funds. Choose large cap funds for 70-75 per cent of your portfolio.
Bhaskar: Is it true that a depressive cycle in the market like this one lasts about 16 months? Is that a statistic?
PV Subramanyam: Your guess, my guess, my daughter's guess will all be guesses. No, any statistic is history, and may not repeat. So, it is, at best, a useless number.
Nihar: I wish to invest in blue-chip stocks. Should I go ahead now OR wait a little longer for the market to settle?
PV Subramanyam: Do a SIP in an exchange traded fund. You can consider Benchmark’s ETF.
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Photograph: Tim Hales/Getty Images
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