7 hrs ago
Choice AMC Urges Valuation Focus Amid Market Volatility
Manish Jain of Choice AMC shared ideas for investing while markets are moving up and down.
He said people should first decide how much risk they can take and how much they need to invest for their goals.
He warned that small-company stocks may be expensive compared with their past values.
He suggested keeping large- and mid-cap funds as the main part of an equity portfolio, with small-cap funds as a smaller part.
He advised investors not to stop regular monthly investments just because markets fall.
A fall can mean the same monthly contribution buys more fund units, but it does not promise a profit.
People investing a large amount at once may spread it over six to 12 months using an STP.
The article says investment choices should also depend on how long the money can remain invested.
Choice AMC Deputy CEO Manish Jain advised investors to prioritize asset allocation and valuations over recent fund performance.
Jain said equity mutual funds had recorded 66 consecutive months of inflows despite the Nifty falling about 14% from its January high.
He urged caution on small-cap valuations, citing the Nifty Smallcap 250 at nearly 35 times earnings, about 23% above its historical median.
Jain recommended maintaining SIPs through market corrections and suggested a six-to-12-month STP for investors deploying a lump sum.
He said fund choices should reflect investment horizon, financial goals, risk appetite, costs, investment process, and risk-management discipline.
- Who
- Manish Jain, Deputy CEO at Choice AMC, offered guidance to mutual fund investors.
- What
- He advised investors to emphasize asset allocation, valuations, and continuing SIPs amid market volatility.
- Where
- The article discusses Indian equity mutual funds and market indices.
- When
- The article cites August and July figures but does not give a publication date.
- Why
- Jain said strong inflows do not mean markets are safe, and investors should align investments with their goals and risk appetite.
Continue investing
Exercise caution
Investing during market corrections
Continue investing
Jain advised investors to continue SIPs through corrections; a fixed contribution may buy more mutual fund units when markets fall.
Exercise caution
He cautioned that strong inflows do not show that markets are safe, and a correction does not guarantee gains or prevent further declines.
Small-cap exposure
Continue investing
Investors have directed a larger share of equity mutual fund inflows to small- and mid-cap funds.
Exercise caution
Jain said small-cap valuations warrant caution and recommended treating small-cap funds as a smaller, supplementary allocation.
Key facts
- Equity fund inflows
- 66 consecutive months, according to Jain.
- Nifty movement
- About 14% below its January high.
- Small- and mid-cap share
- 51% of equity mutual fund inflows in August.
- Large-cap outflows
- Around ₹2,470 crore combined in July and August.
- Valuation comparison
- Nifty at around 19 times earnings; Nifty Smallcap 250 at nearly 35 times and about 23% above its historical median.
- Monthly SIP contributions
- A record ₹32,297 crore in August.
- Lump-sum investment approach
- Jain said an STP spread over six to 12 months may help stagger investment.
Sources
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