How Would You Approach Lumpsump Amount Investment for Long Term

Personal finance
1

I need some genuine help in getting to know POV and How would you approach the below scenario if you had to do it.

I (28) and my brother(30) managed to earn 4Cr in net profit after taxes assumption mostly second half of the year 2023 due to some businesses working out very well.

This money is currently sitting in bank account only as it was mostly second half we were busy in business only.

We don’t have any debt or liabilities to pay off or any big purchases to make.

Didn’t want to go to the advisers due to lack of trust.

I am aware of the market, and instruments and have a fair understanding of trading as well.

Wanted to know how would you deploy this in the market and over what period and anything else I should keep in mind? Safety is priority.

2

If safety is the ONLY priority, then

Mostly in GSECs.
…and rest into Large-cap passive ETFs.

BTW, the period depends on your lifestyle / potential future needs.

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3

Understood.

I do want to invest in Index ETF( top 1-2 bees) and Debt.

Currently, I want to move the money from a bank account which is sitting idle to at least something which generates some money with safety and from where I can slowly add to ETFs and any other investment, (as the market looks very high currently)

How would you approach this case?

4

Sovereign T-Bills with various maturity dates come to mind.

There are a bunch of T-Bills…

  • available on NSE (i.e. the secondary market)
  • maturing each calendar week for the next several months
  • in volumes of 10s of lacs INR available to trade each day
  • currently providing returns of around 6-8% per annum.

Can immediately get the lumpsum few crores into various T-bills over the next few days using your trading/brokerage account.

And subsequently each time a T-bill you hold, matures in the near future,
and when you receive the amount, you can invest into some GSEC / ETF that week or month.
(this is assuming you really wish to spread out your investments,
and NOT do a lumpsum into GSECs/ETFs right now.)

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5

I would suggest to park the major part in bank FDs and some part in balanced MFs. Apart from that gold bonds and non taxable bonds are also a good option.
Parking some money in blue chips can also bring good returns in long run.

6

Mov the chunk to a liquid fund with maturity 90 days , ensure to have 0 exit load and low TER.
Them setup STP fr Liquid fund to MFs as per your liking…I use Liquid funds as a parking area for my funds