Assuming that I invest a lump sum amount in a fund in 2012 when the Sensex is at the 17,000 level and after 5 years if the Sensex is back at the 17,000 level, will the NAV in 2017 be the same as in 2012?
A very honest answer is that we don’t know. However, it’s very likely. The markets are unpredictable and the past 5 years have been very difficult. But if you look at the broad numbers, about 60 per cent of the funds have been able to beat the Sensex over the past 5 years. Hence, returns will depend on the markets and the kind of fund you’ve chosen. It might get disappointing if you get unlucky with both.