Thank you Vipul, for your comments,
Today's market is not for investment in long term, getting in here is like offering a tuition fee of more than 50% of your capital to catch a train which is in the verge of reaching it's destination and take an 'U' turn.
No doubt markets are inching up every week perhaps, but the underlying strength is pretty weak. Traders manage to scrape through with both losses and gains and they trade futures to gain from the down side move.
All the best stocks have run up mostly and have lost their energy at least for the time being. You say it is your hard savings. Split it into 20, invest in the best Mutual fund 5% every month. By doing this you would have got into the market at a fairly decent average. I suspect this market is going to go nowhere for another few years. There are some demonic events waiting to happen, major economies of the world like the US and the UK are into a bloated balloon of debts.
Though they may not leave their economies to beg like Greece, Spain, Portugal, Italy or Hungary. Still there is going to be a big damage to the world financial markets, a Mother of all Recession is on way. We traders or those seasoned to market dynamics can (i say can) survive, not innocent investors or new traders.
When these disasters happen you get the greatest opportunity to invest the best of best companies for a price that dirt cheap. That will be a golden egg in your basket and you can cherish it for your life time. Remember the last recession equivalent to the one expected now was in 1930 a near century ago. After that the market has grown by 1000%. This may seem small compared to the percentages which people keep talking these days.
But, take in mind that the stock markets have always given above average returns compared to any other investments in the long term. If you invest in good dividend paying companies, that will add a little more to the regular growth by giving you some extra cash every year, which will also be of real motivation to you.
The details I have given here are for a pretty long term, people may think this is too much for the 20K for which you sort advice, but the real value of that really huge money will only be known to the person who owns it. Though I have dabbled the financial markets across the globe with thousands of dollars worth of trades, still I know the emotional value that will be attached your money in particular.
I believe this small write up will give you the necessary inputs you need for parking those precious money of yours.
