In this period of high volatility ,many have started thuinking about the risk in stock market. This will be the right ocassion to recollect a slide from the article" Power of Equity *" . The following slide clearly depicts, the longer a person stays in the market - the probability of losses keep coming down.
( As per the slide which has compiled past data from Indian Indices)
If your investment horizon is 15 years , % times positive return is 100% and Minimum and maximum returns are 13% and 27%.
Even if you take the minimum return of 13% ( Equity income which is tax free now as cap gains and dividends), This is far more than a tax free PPF return of 8%. So, its worthwhile to invest in equity for a longer time frame.
As always SIP in an Equity MF would be the best way to go for a novice retail investor.
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