Long term mutual fund/index fund investment strategy
INDICATORS: 50MA, 200MA, RSI(14)
CHART:
Index that you are planning to invest in(eg: nifty 50 -> niftybees).
Index that mostly resembles your mutual fund(eg: cnxsmallcap -> smallcap mutual funds).
BUYING SRRATEGY:
When above 50MA, 200MA -> SIP min amt(eg 5000)
When below 50MA, 200MA -> SIP double the min amt(eg 10000)
When 1st dip in RSI(14) below 30 & below 50,200MA -> Lumpsum 6 times the min amt,
When 2nd dip in RSI(14) below 30 & below 50,200MA -> Lumpsum 8 times the min amt,
When 3rd dip in RSI(14) below 30 & below 50,200MA -> Lumpsum 10 times the min amt, so on and so forth.
SELLING STRATEGY:
When 1st rise in RSI(14) above 70 & above 50,200MA -> Sell 4 times the min SIP amt,
When 2nd rise in RSI(14) above 70 & above 50,200MA -> Sell 6 times the min SIP amt,
When 3rd rise in RSI(14) above 70 & above 50,200MA -> Sell 8 times the min SIP amt, so on and so forth.
POINT TO NOTE: Invest throughout the year even when RSI shows overbought. Your investment amount would be the min SIP amount while you'll be selling 4(+) times the min SIP amount hence you'll be net seller.
DISCLAIMER: This has been back tested only on paper and not in real time. I'll be following this strategy starting from june 2024. Modifications can be done in future according to the performance of the strategy.
CHART:
Index that you are planning to invest in(eg: nifty 50 -> niftybees).
Index that mostly resembles your mutual fund(eg: cnxsmallcap -> smallcap mutual funds).
BUYING SRRATEGY:
When above 50MA, 200MA -> SIP min amt(eg 5000)
When below 50MA, 200MA -> SIP double the min amt(eg 10000)
When 1st dip in RSI(14) below 30 & below 50,200MA -> Lumpsum 6 times the min amt,
When 2nd dip in RSI(14) below 30 & below 50,200MA -> Lumpsum 8 times the min amt,
When 3rd dip in RSI(14) below 30 & below 50,200MA -> Lumpsum 10 times the min amt, so on and so forth.
SELLING STRATEGY:
When 1st rise in RSI(14) above 70 & above 50,200MA -> Sell 4 times the min SIP amt,
When 2nd rise in RSI(14) above 70 & above 50,200MA -> Sell 6 times the min SIP amt,
When 3rd rise in RSI(14) above 70 & above 50,200MA -> Sell 8 times the min SIP amt, so on and so forth.
POINT TO NOTE: Invest throughout the year even when RSI shows overbought. Your investment amount would be the min SIP amount while you'll be selling 4(+) times the min SIP amount hence you'll be net seller.
DISCLAIMER: This has been back tested only on paper and not in real time. I'll be following this strategy starting from june 2024. Modifications can be done in future according to the performance of the strategy.
Disclaimer
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