Mf investing

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Amit Kumar Das (Querist)

17 March 2019 I had invested in a particular ELSS Direct (Growth) fund lumpsum 3 yeara ago to save tax u/s 80C. Now, on completion of the lock-in period that fund has given good return (56% absolut). Would it be advisable to invest again in that fund this year after redeeming the old units?

K Srinivas, CMA CS

K Srinivas, CMA CS (Expert)

17 March 2019 56% for three years translates to a compounded annual growth rate of 15.95%. Whether to redeem the investment now ,Depends financial performance of the said fund. In my opinion, you can redeem if you wish to lock in the gains and reinvest in mutual funds under SIPs. Lumpsum investment doesn't always guarantee better return as we may invest when the prices are high

Amit Kumar Das

Amit Kumar Das (Querist)

17 March 2019 I understand that SIP is better than lumpsum to average out.
But, my moot point is whether it is advisable to invest once again in the same fund which has already appreciated to some good extent over the last three years or to try another fund in the same category(ELSS) which has given nearly comparable return during the same period.

K Srinivas, CMA CS

K Srinivas, CMA CS (Expert)

17 March 2019 ok. To invest in the same fund depends on the financials and how the fund fares with its competitors under the same category.

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