I came to India in March this year and had about $100,000 to invest. I invested that amount in mutual funds on the advise of a friend. I think he has put in about 60 per cent in Reliance Equity Hybrid and 40 per cent in L&T Hybrid Equity. Initially, for about three months, I was happy. The amount was growing. But then suddenly I found that there is a reverse trend now. I am bit worried. That's the only money I have.
It is about Rs 70 lakh. I think your friend hasn't done the right thing. The keyword is not that whether it's a good fund, it is about the criticality of that money. If this money is the only money you have or forms a significant part of your savings, then you should have invested in a manner that you are able to average the investment over a period of time. The two funds you have invested in are good funds. But a good fund will not save you from a decline in value of a substantial kind if it is invested in one go at the wrong time. The only insurance you have is to spread your investment over a period of time. It can range between six months to three years. If it is extremely critical, it should be spread over three years. So that you eliminate the possibility of catching a market high. And if the money is not very critical, say, it is you annual bonus, then spread it over six months. This is where the mistake is. Don't worry. Take a stock of it. The decline won't be very substantial. Your friend has tried to do the best he could, but maybe he didn't have the understanding. And when the market is in good times, people lose the perspective in their optimism. It may not be a very deliberate mistake. It may be just a matter of chance that somebody may not be aware that how to deal with it. So take a stock, think about it and for future, it's your money--take charge.