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News18
30-07-2025
- Business
- News18
SIP At Peaks Or Bottoms? Market Timing May Not Be As Crucial As You Think
Experts say the probability of consistently investing in SIP at market bottoms is extremely low, making market timing an unreliable strategy Systematic Investment Plan, or SIP, is emerging as a popular investment method. It offers a means for disciplined investing, as you set aside a fixed sum of money every month for future savings. A SIP offers potential for long-term wealth creation, as you gain from the power of compounding and can get a diversified portfolio with just one investment, which is managed by an expert. But what is the right day to start a SIP? Timing matters a lot when you're batting – like finding the sweet spot on the bat. In mutual fund investing, it might matter a lot less. A study by Motilal Oswal Mutual Fund shows that investors who started SIPs at market peaks and those who began at market bottoms ended up with nearly identical long-term returns. The first period examined in the study was from 2000 to 2005, a time marked by the aftermath of the global bubble burst and the Indian market's subsequent recovery – a phase of high volatility. During this period, the Nifty 500 Index's price-to-earnings (PE) ratio swung sharply, peaking at 37.26 on February 24, 2000, and bottoming out at 11.58 on September 21, 2001. This minimal return disparity is attributed to rupee cost averaging, a key feature of SIPs, which helps smoothen out the effects of market volatility. The study reinforces the idea that regular investing across market cycles reduces the risk associated with market timing. Even though starting SIPs at the bottom of the market may deliver slightly higher returns in the short term, the advantage diminishes considerably over time. Experts point out that the probability of consistently investing at market bottoms is extremely low, making market timing an unreliable strategy. 'Time in the market beats timing the market," said Pratik Oswal, Head of Passive Funds at Motilal Oswal AMC. Financial advisors echo this view, recommending consistent and disciplined investing for long-term wealth creation rather than attempting to predict market movements. About the Author Aparna Deb Stay updated with all the latest business news, including market trends, stock updates, tax, IPO, banking finance, real estate, savings and investments. Get in-depth analysis, expert opinions, and real-time updates—only on News18. Also Download the News18 App to stay updated! tags : SIP First Published: July 30, 2025, 12:22 IST News business » savings-and-investments SIP At Peaks Or Bottoms? Market Timing May Not Be As Crucial As You Think Latest News Modi Govt's Efforts Put Terrorism On Global Agenda: Jaishankar During Op Sindoor Debate India Savings And Investments SIP At Peaks Or Bottoms? Market Timing May Not Be As Crucial As You Think Telugu Cinema Vijay Deverakonda's Kingdom To Give US Fans A Head Start With July 30 Premiere Viral Japan, Russia Tsunami: What Is Safe To Eat? Explained As Floodwater May Contaminate Food Bollywood Anil Kapoor Calls Anand Ahuja 'Heart Of The Family' In Special Birthday Post latest news
Time of India
30-07-2025
- Business
- Time of India
Market timing has little impact on SIP returns: Motilal Oswal MF study
Mumbai: Timing matters a lot when you're batting - like finding the sweet spot on the bat. In mutual fund investing, it might matter a lot less. A study by Motilal Oswal Mutual Fund shows that investors who started SIPs at market peaks and those who began at market bottoms ended up with nearly identical long-term returns. The first period examined in the study was from 2000 to 2005, a time marked by the aftermath of the global bubble burst and the Indian market's subsequent recovery - a phase of high volatility. During this period, the Nifty 500 Index 's price-to-earnings (PE) ratio swung sharply, peaking at 37.26 on February 24, 2000, and bottoming out at 11.58 on September 21, 2001. Explore courses from Top Institutes in Please select course: Select a Course Category Public Policy Others Data Analytics others Design Thinking Project Management Artificial Intelligence Degree Cybersecurity Leadership MCA Management Data Science Healthcare MBA Product Management healthcare PGDM Technology Finance Digital Marketing CXO Data Science Operations Management Skills you'll gain: Duration: 12 Months IIM Calcutta Executive Programme in Public Policy and Management Starts on undefined Get Details Skills you'll gain: Economics for Public Policy Making Quantitative Techniques Public & Project Finance Law, Health & Urban Development Policy Duration: 12 Months IIM Kozhikode Professional Certificate Programme in Public Policy Management Starts on Mar 3, 2024 Get Details Agencies Despite this wide valuation gap, investors who started SIPs in either of these extremes and continued till March 2025 ended up with nearly identical long-term returns. An investor who began investing in February 2000 earned a CAGR of 15.47%, while one who started at the lower valuation in September 2001 earned 15.55%, according to the study. Best MF to invest Looking for the best mutual funds to invest? Here are our recommendations. View Details » by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Villas Prices In Dubai Might Be More Affordable Than You Think Villas In Dubai | Search Ads Get Quote Undo "Relying solely on valuation levels to start SIPs adds unnecessary hesitation," said Pratik Oswal, head - Passives, Motilal Oswal Asset Management. Similarly, between 2006 and 2010, the stock market went on a rollercoaster ride - surging during a roaring bull run, plunging during the global financial crisis, and eventually staging a recovery. An investor who started a SIP on January 4, 2008, when the Nifty 500 PE was 27.07, earned a return of 13.97%, while one who began investing when the Nifty 500 PE had dropped to 9.29 on October 27, 2008, earned a return of 14.36%. Live Events 'Systematic investment plans go through an entire business cycle seeing ups and downs. This volatility over longer terms averages out returns,' says Nikhil Gupta, founder of Sage Capital. Between 2011 and 2015, the stock market witnessed a volatile period. Equities were under pressure till mid-2013 after India was famously lumped together as part of 'Fragile Five'— a term used to describe emerging market economies that were vulnerable to capital flight risks. Subsequently, stocks rebounded on indications that the Narendra Modi-led BJP is coming to power. A SIP started on August 19, 2015, when the Nifty 500 PE was 25.79, returned 15.26%, compared with a SIP started on August 28, 2013, at a PE of 15.11, which returned 14.89%. 'Consistent long-term investing through SIPs have shown effectiveness regardless of where the market stands during the time of investing,' said Oswal.
Time of India
28-07-2025
- Business
- Time of India
NFO Alert: Kotak Mutual Fund launches active momentum fund
Kotak Mutual Fund has announced the launch of the Kotak Active Momentum Fund , an open-ended equity scheme following the momentum theme. The fund aims to capture opportunities by identifying stocks with strong earnings momentum , using an in-house proprietary model. The New Fund Offer (NFO) will open for public subscription on July 29 and close on August 12. Explore courses from Top Institutes in Please select course: Select a Course Category Artificial Intelligence CXO Digital Marketing Finance Data Science Management MBA Data Science Product Management Operations Management Technology healthcare Project Management Leadership Cybersecurity Public Policy Healthcare MCA Degree Design Thinking Data Analytics PGDM Others Skills you'll gain: Duration: 7 Months S P Jain Institute of Management and Research CERT-SPJIMR Exec Cert Prog in AI for Biz India Starts on undefined Get Details Also Read | Smallcap mutual funds dominate return charts in 5 & 10 years. What's driving the surge? Best MF to invest Looking for the best mutual funds to invest? Here are our recommendations. View Details » by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like 21st Century Skills Start with Confident Communication Planet Spark Learn More Undo Momentum investing typically involves buying stocks with rising prices, anticipating that the trend will continue. However, momentum isn't limited to price alone. Earnings momentum focuses on stocks with upward earnings revisions and favorable analyst ratings, supported by strong fundamentals, according to a press release by the fund house. The Kotak Active Momentum Fund targets companies with increasing earnings per share (EPS), driven by analyst upgrades or positive earnings surprises. The proprietary model evaluates momentum using earnings and sales growth, along with analyst ratings, the release said. Live Events The fund will be benchmarked against the Nifty 500 Index TRI and managed by Rohit Tandon (for equity and overseas investments) and Abhishek Bisen (for debt investments). 'Markets are a slave to earnings. Historically, earnings have outperformed price across both bull and bear phases. This enduring pattern is the foundation of our fund. At Kotak Mutual Fund, we've developed a model that goes beyond mere price trends,' said Nilesh Shah , Managing Director, Kotak Mahindra Asset Management Company. The fund portfolio will be constructed from the top 250 stocks by market capitalization, applying rigorous filters to exclude weaker candidates. The result is a diversified basket of 40–50 high-quality stocks, dynamically reviewed and rebalanced to capture emerging opportunities. 'We've integrated investment strategy with data science to create a fund that captures momentum driven by earnings. The Kotak Active Momentum Fund is built on a simple conviction: when earnings rise and upgrades follow, prices eventually align. Our model captures this with discipline and data. This is not a trend play—it's an earnings-led opportunity,' said Rohit Tandon, Fund Manager for the Kotak Active Momentum Fund. The Kotak Active Momentum Fund offers investors a robust tool to participate in momentum with discipline and consistency. It provides a clear, research-backed approach to staying ahead, by investing in what truly drives stock performance. During the NFO period, investors can invest a minimum of Rs 5,000, and any amount thereafter. For SIP purchases, the minimum amount is Rs 500, subject to a minimum of 10 installments of Rs 500 each. This product is suitable for investors seeking long-term capital growth through investment in a portfolio predominantly consisting of equity and equity-related securities exhibiting momentum characteristics.
Time of India
28-07-2025
- Business
- Time of India
Why 60% of NSE 500 stocks remain below their 2024 highs
Mumbai: The Nifty 50 and Nifty 500 are 5-6% off their record levels in September 2024, but a large part of the market is yet to catch up despite the recent rebound in these indices. While most remain below their 2024 highs, at least 60% of the stocks on the NSE 500 index are still over 20% below those levels last year, according to an ETIG study. Analysts said these stocks may not cross their highs of 2024 in a hurry as concerns over elevated valuations remain, while the likelihood of an outsized earnings growth remains thin. The record-breaking rally in 2024 had pushed many stocks to lifetime highs at various points leading up to September-when the four-year bull run reversed. In the Nifty 500 index, 24.2% or 118 stocks are trading 20-30% away from their peaks hit in 2024, while 83 stocks remain 30-40% away from their highs and 113 are at least 40% below their highs. The Nifty 500 Index and benchmark Nifty Index are 6.1% and 5.3%, respectively, away from the peaks in September 2024. Explore courses from Top Institutes in Please select course: Select a Course Category healthcare Degree MBA MCA Technology Healthcare Data Science Digital Marketing Management Data Science CXO Product Management Finance Design Thinking Artificial Intelligence others Leadership Operations Management PGDM Public Policy Data Analytics Others Cybersecurity Project Management Skills you'll gain: Duration: 11 Months IIM Lucknow CERT-IIML Healthcare Management India Starts on undefined Get Details "This points to a narrow market rally, often driven by specific sectors or large-cap names," said Sudeep Shah, vice president and head of technical and derivative research, SBI Securities. While headline indices like Nifty 50 or Sensex have rallied, a significant portion of the market-particularly in the mid- and small-cap segments is still lagging, said Shah. Jaiprakash Power Ventures, Network 18 Media & Investments, Zee Entertainment Enterprises, Sammaan Capital and Suzlon Energy along with Adani Total Gas, MMTC, Yes Bank, HFCL and Vodafone Idea are among the stocks that are 84-97% below their all-time highs. Four stocks including Laurus Labs, Fortis Healthcare, Shyam Metalics & Energy and Torrent Pharmaceuticals are trading above their highs. Agencies Elevated valuations Ashwini Shami, EVP & senior portfolio manager, OmniScience Capital said that despite being 20-30% off the peaks, the broader market remains overvalued as the stocks that traded at 50 price to earnings (PE) ratio-a valuation measure-during the bull market before September, remain at around 30 times, even after a 30-40% drop in stock prices. "Even a reasonably high growth company cannot be expected to deliver 35-40% growth to justify the valuations," said Shami. "The overvaluation is not over in the small and midcap stocks and these stocks are not expected to go back to the previous highs as that momentum was driven primarily by euphoria." Between September and February, the Nifty 500 index slumped 18.8% while the Nifty Mid-cap 150 and Small-cap 250 indices tumbled 20.6% and 25%, respectively. In the last three months, the mid-cap and small-cap indices rallied 9.2% and 12% each while the Nifty 500 index gained 5.3% in the same period.
Time of India
21-07-2025
- Business
- Time of India
How glitter of gold can help your equity heavy portfolio to outshine
The power of mix: why portfolios need more than just equities Academy Empower your mind, elevate your skills The portfolio with a heavy equity weight (70% equity) has underperformed in 2025 so far due to high volatility driven by global uncertainties, demand growth challenges, and concerns about corporate India's earnings growth . However, over the long term, equities have outperformed both debt and the debt-heavy portfolio (with a 60% allocation) has performed well in 2025 so far but ranked at the bottom over the long run. Additionally, its performance has seen high volatility since has become a crucial asset. The portfolio with no gold exposure remained among the two biggest underperforming portfolios for six years between 2015 and 2025. The significance of gold is also evident in the long run. A portfolio without any gold is the second-worst performer over the last 10 years. Low correlation with equities, hedge against inflation, and safe-haven status make gold a key asset for managing investment volatility Though the equal-weighted portfolio has been the top performer so far in 2025, its performance was modest in the long MF. *2025 data is YTD based on 15 July 2025 closing values. Other years' returns are calculated between the first and the last trading day closing values. Numbers in brackets are the weighted average returns (or portfolio returns) of the respective investment allocations. The 10-year weighted average return is based on compounded returns of the respective assets, calculated between 15 July 2015 and 15 July 2025. Benchmarks used: Equity: Nifty 500 Index, Debt: Crisil Composite Bond Index, Gold: Nippon India ETF Gold BeES
