I intend to invest a lump sum amount for my new born daughter. Please advice on the funds that I can invest in with a 5-year term.
Jaya Rathore, Jaipur
It is encouraging to note your eagerness to invest for your new born daughter. However, we feel one should invest regularly in a systematic manner for wealth creation. There is an element of risk in timing your investment when you go in for lump sum investment. You can park the lump sum in a liquid fund and initiate a systematic transfer plan to a diversified equity fund depending on your risk tolerance. By starting a SIP you do not have to worry about timing the market, moreover, your investments will average out the acquisition over time and also gain from the power of compounding in building a sizeable corpus for your daughter in five years.
