Rafting In High Seas

Remember Chuck Noland, the FedEx executive, who was cast away on a desolate island by a plane crash? Through his every failed attempt to rescue himself he learned to make his raft stronger. He was lucky at last when a ship spotted him in the sea, but you may not be so in a sea of 5,000 companies listed on the Bombay Stock Exchange. So, set your raft right lest you take a plunge. In your first tryst with the rough waves of the equity market, your best raft could be the Exchange Traded Funds (ETFs) because they replicate an index and its holdings and generate returns similar to the underlying index. “The optimal approach for an investor new to the equity markets is to approach these waters (equity investing) via Exchange Traded Funds as a stepping stone,” says Chintan Haria, who leads the Product Development and Strategy wings at ICICI Prudential AMC. A Nifty 50 Index ETF...