Have ₹500,000 to invest? Experts recommend these asset classes for best returns in 2024

Only two weeks into the new year, the market is already at new highs, and small and mid-cap stocks are considered expensive, making investors wary of investing further in equities.

With all this in mind, where should investors put their money in 2024? We asked some experts where they should invest their money, if they have one. INR$500,000, and they think the majority of this amount should be allocated to large mutual funds and the rest to bonds.

The rationale behind investing in large-cap funds is that still With interest rates at their peak, investing in bond funds should be done for a long period of time and it is recommended to lock your money in fixed deposits or other fixed income securities such as bonds or bond mutual funds.

large cap fund

One of the investment options INRIt is wise to allocate 70% of $500,000. In other words, INR$350,000 goes into a large-cap stock fund and the rest goes into a debt fund.

Sridharan S, Sebi-registered investment advisor and founder of Wealth Ladder Direct, says you should invest 70% in large-cap stocks as they are not overvalued yet. Value stocks are already expensive, so you should invest in growth stocks. The rest of the money can be put into a dynamic bond fund with a two- to three-year term, he explains.

Also read: Why should you invest in long-term bond mutual funds during a bull market?

Explaining the reason for his optimism on large-cap stocks, Sridharan said, “As inflation eases, interest rates are likely to fall. This will be reflected in higher corporate earnings and, in turn, stock prices. It will be.”

short term or long term

Experts also argue that investment decisions are made depending on the investment horizon, i.e. whether the investment is short-term or long-term. Also, if your financial goals are still far away, it’s best not to get carried away with short-term volatility.

“Buy right and sit tight!” is a saying that works for long-term investors. On the other hand, if you want to take advantage of short-term volatility or have some capital to invest, you need to be careful where you invest now.

“I always advise my clients to invest a lump sum toward their financial goals. So if you have a lump sum, check whether you need it for your short-term goals. If you’re short of your goal amount. You can apply this lump sum towards the same amount. FD this lump sum in the short term,” says Preeti Zende, Sebi Registered Investment Advisor and Founder, Apna Dhan Financial Services. he says.

And if you don’t need this money in the short term, you can use the same money for long-term goals, she added.

“Current market levels are high, but with this allocation you can invest some in stocks. You can also choose large-cap stocks or index funds and some in flexi-cap.” Avoid small and mid-cap stocks. It would be better to When it comes to debt, you can choose PPF/SSY or invest in NPS or Gilt funds,” he adds Zende.

On the other hand, Renu Maheshwari, a Sebi-registered investment advisor, does not believe in short-term investing. “All your money should always be invested around your life and financial goals. INR500,000 shouldn’t make a difference. “Just because the calendar year has changed, the fundamentals of investing should not change,” she concluded.