Booked profits? Be careful about re-entering

Wait for a correction

In the last six months, investors have consistently booked profits and taken out money from both the secondary market and mutual funds.

Since April, Rs 14,624 crore has been redeemed from mutual funds and another Rs 4,838.92 crore from the equity market.

While booking profits is one side of the story, the second is what to do with this sudden surplus in bank accounts?

"If an investor has exited the market at the 20,000 level, it is not prudent to re-enter at the same level. It is best to wait for a correction to consider equity exposure again," says Hemant Rustagi, CEO, Wiseinvest Advisors.

Most financial planners feel the same.

Investors should stay away from the secondary market, at least for the time being.

For those contemplating a re-entry, here are a few options they could consider, and a few they should best skip at the moment.

Text: Masoom Gupte, Business Standard

Images: Reuters