“I think post-Diwali will be better to invest in as markets are good during October. So Best Month to Invest will be the last quarter of the year” – These are exact words from prospective investors who missed a well-balanced investment strategy throughout his life. Now he underwent financial planning and when everything has been detailed out – he uses this excuss.

Is there really any best month to invest in Equity?

Well, I also thought to give this thought a full stop. There is the best month to invest or not? I went to the drawing board and did some research.

Best Month to Invest – Market Back Testing

Situation 1

A person is investing Rs 100000 in Nifty every First working day of January for 20 years 1998 to 2017.

I am not taking any mutual fund scheme as it is managed and then fund management skills will also play role in results. So keeping it simple – trying to find markets if support the best month to invest theory.

Result: Rs 20 Lakh investment turned to Rs 90.62 Lakhs

Situation 2

A person is investing Rs 100000 in Nifty every First working day of April for 20 years 1998 to 2017.

Result: Rs 20 Lakh investment turned to Rs 87.77 Lakhs

Situation 3

A person is investing Rs 100000 in Nifty every First working day of July for 20 years 1998 to 2017.

Result: Rs 20 Lakh investment turned to Rs 92.10 Lakhs.

Situation 4

A person is investing Rs 100000 in Nifty every First working day of October for 20 years 1998 to 2017.

Result: Rs 20 Lakh investment turned to Rs 94.52 Lakhs.

So the conclusion – Best Month to Invest

So, if you want to ignore small percentages/differences it hardly matters.

If you want to consider – Yes historically October followed by July, Jan & April are the Best Months to Invest. They were all – Great Months to Invest!

Did somebody ask for DEBT? Well, just the trivia – The same investment (Rs 100000 each on first day of April for 20 years) in the PPF Account would have yielded Rs 52 Lakhs.

This is just for knowledge. The 2 investments (Nifty & PPF) should not and cannot be compared as there are altogether different risks involved.

So let me know your comments on this subject.