However, before going any further, first of all. First, you cannot entirely escape volatility if you invest in stocks or stocks. Stocks can be volatile and risky. A volatile phase or losses can last for a few years. A bear market lasting two years is something almost every investor would remember. However, new investors who have started investing in equity programs have not experienced this. Maybe that’s why they never believed in the old principles about risk and volatility.
Remember that the risk is real. Volatility too. They are part of equity investments. You can’t avoid them entirely, but you can manage them. You make sure they are within your comfort level. Of course, you can have unpleasant surprises from time to time. Still, you will survive without too much damage.
Changing the allocation of investments according to the prevailing market conditions is something to be avoided, experts would remind you of this old principle. This is mainly because your quick fixes often go wrong. We cannot predict the market correctly all the time. For example, the current mood is due to factors such as the Russian invasion, soaring oil prices, rising interest rates, tighter liquidity conditions, among others. However, no one can say how long these factors will impact the market or how severe it will be.
Remember these points as we list a few categories that can help you weather the likely storm.
Balanced benefit plans
They are also called dynamic allocation schemes. These plans invest in equity, debt and arbitrage. Equity allocation based on key market parameters or an internal fund house mechanism. They invest less in stocks when the market is expensive. This makes them ideal for navigating today’s market.
Plans you can consider investing in: Edelweiss Balanced Advantage Fund, ICICI Prudential Balanced Advantage Fund, Aditya Birla Sun Life Balanced Advantage Fund
If you want to learn more about these plans, read the article: Best Balanced Advantage Funds
Aggressive hybrid funds
Aggressive hybrid funds invest in a combination of equities (65-80%) and debt (20-35%). The debt portion of the portfolio provides a cushion in a volatile phase of the market. These schemes provide you with equity and debt asset allocation. They also continuously rebalance the portfolio while providing tax benefits.
Schemes you may consider investing in: SBI Equity Hybrid Fund, Canara Robeco Equity Hybrid Fund, Mirae Asset Hybrid Equity Fund, ICICI Prudential Equity & Debt Fund
If you want to know more about these schemes, read the article: Best Aggressive Hybrid Funds
Large Cap Funds
As their name suggests, these schemes invest in very large companies. For this reason, they are more secure than other pure equity systems. They are ideal for building wealth over a long period of time without too much volatility. In the current scenario, they are suitable for cautious investors.
Plans you can consider investing in: Axis Bluechip Fund, Canara Robeco Bluechip Fund, Mirae Asset Large Cap Fund,
If you want to know more about large cap funds, you can read this article: Best large cap funds