Should you prepay your home loan?

There's a typical question that I often get from people who write in to Value Research Online asking for advice about their investment problems. Recently, one particular reader said that he had a housing loan on which he is paying interest at the rate of 9 per cent per annum. He's paying this monthly EMI comfortably out of his income without any problems. Now, he finds that he also has some cash accumulated which he can invest. He would like to know which is the better option: should he repay some of his housing loan before schedule, or should he invest in an equity mutual fund for the long term? Note that he doesn't have any other equity investments before this. This is not an uncommon dilemma. In fact, I would guess that practically every salary earner who takes a housing loan