I want to invest my lumpsum money in hybrid funds through STPs. What should be the duration?
Transcript: There is no rule as such. But if it is a very sizeable amount and if it is so sizeable that it is a once in a lifetime kind of situation, then it should be over a long period of time. The longest period I would think of will be about 3 years because one will be able to catch a good part of any market cycle. If you spread it even longer, then your investment will not be put to work at all. Generally speaking, one should be guided by the scale of money and how important it is. If I am going to invest my annual bonus, then I would like to invest the amount over the next 3-6 months. That would be good enough. If this is a money which is my superannuation benefit or earned it throughout my life, I would generally like to spread the money in half the period of time I would take to earn that money. But the maximum period should be three years, simply because if it is spread beyond three years, the money will not be put to work.
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