Indian stock markets are near an all-time high. Not only that but it has gone up continuously since the last 12 months.
Here are a few things you should and should not do:
- 1. If any stock is there that you feel has not gone up in this rally and therefore may go up – do not invest in that stock. There is a high chance that it may not go up soon. There must be some reason why it did not participate in the rally and therefore is a risky investment.
- If a stock performed very well in the rally and you want to take your chances thinking that it may keep going up then spread your investment in equal parts in the next 6 months.
For example, if you have 60,000 to invest then buy stock worth 10k of that company, remember the date and on the same date for the next 5 months buy that stock. You will end up getting the best average rate possible. In one or two or maybe all months, the stock will be lower than the price you paid to buy in the previous month. Even if the stock keeps going up – by the time it reaches the 6th month you will be in good profit and if your view was to invest for the short term – you can exit the stock with profits in the sixth month itself.
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