You have just received a big amount as your annual bonus. While the first temptation was to splurge it all, good sense prevails and you decide to invest 80% of it in equity mutual funds.
But you are not sure how to do it? Should it be one shot lump sum or in parts?
These days what you hear is “Market index touches all time high.” The popular media has this headline all over.
You are now forced to think if this is the right time to invest a lump sum amount in equity mutual funds.
So, you reach out to various forums, blogs, websites and friends who give this advice:
“Do an STP or a Systematic Transfer Plan.”
“Put your money in a liquid fund and then start an STP into the equity fund for 6 to 12 months.”
You feel almost convinced that is the way to go.
Hold on! Why STP at all? Does it really work?