Hi

If you are long term investor willing to invest for 3 years and more today this is the right time to invest. There is no doubt that Europe is in a financial mess and it will take few years for it to clear the same. There will be a negative impact on the investment sentiment India too. But India story still remains intact. Fundamentally Europe will have little impact on India. Currently the equity market is trading at an attractive level. There are lot of stocks that are available at reasonably lower price compared to their intrinsic value. In my view long term investors should start investing at the current levels.

Thanks

1. Start Early : The only way you can make the most out of the limited time you have is to start early. The sooner you invest, the more time your money will have for growth. If you delay, you will almost certainly have to invest much more to achieve a similar result. Let the power of compounding work for you.

2. Keep Some Cash Aside : It is always a good idea to have some money set aside in case of emergencies. Maintaining three to six months worth of living expenses will insulate you from a sure fire formula for investment loss – distress selling.

3. Know Your Risk Profile : What is the point of investing in the stock market if you are going to lose sleep, if you don’t get a heart attack first, every time prices go through a rough patch. You need to be realistic about your risk appetite. An investment advisor can help you determine your tolerance for risk.

4. Never Forget About Inflation : Don’t fall into the false sense of security that very conservative investments might give you. The returns may look respectable at the start but not after you deduct the effects of inflation. Keep in mind that risk is not just about losing money. It is also about not having enough in the end.

5, Think Carefully About How Long You Can Stay Invested : If you plan to stay invested for a long period of time, say five years or more, then it is okay to go into the stock market and let your money work harder for you. But if you will need your funds very soon, you are going to be better off with low risk investments.