It’s Clearly a Case for Investing in Equity for the Long term….and if one is not going to be bothered with the Anxieties of Specific Stock or Sector or Theme Selections,then there is a strong case made out yet to adopt the Passive Style and Strategy of Index Investing

Even from Inception in 1986 ,with 1978/79 set as a base of 100,the SENSEX has returned a CAGR of 17.4% in 33 years or an absolute of 19360 %…that’s a remarkable appreciation

Sensex has provided positive returns in the Long Term….even better if you consider that alternative and much safer Investment avenues like Bank Fixed Deposits would have given a lower post tax return of below 7% pa

If you had remained invested till date from 1991,2001 or 2004 the CAGR is 15.9%,17.2% and 18.7 % respectively…that’s very good….considering you have rode the Highs and Lows too and remained Invested…you really do not need to time the markets in the Long term…in other words,you need not have sold of in the January 2008 High of 21000+….if you had,you may have never got back in again into Equities at the Lows ! and therefore would have missed out investing in the strong rebound

I have taken the Opening Sensex levels in the Years 1991(Modern Reforms initiated…Remember “India is a Turnaround Scrip” ), 2001 (Turnaround Year after ICE meltdown in early 2000) and 2004 (beginning of a strong Bull run) and computed the Absolute and CAGR % returns over  years from these Opening levels to the High of 21207 reached   on January 10, 2008,to the intra day low of 7697 reached on October 27,2008 and the November 24,2010 closing of 19460