Q: I want to spend small amount of money in shares, tell me in which to spend?
Answer: Your best bet is a SIP (Systematic Investment Planning) where you put a small amount monthly in a mutual fund. A mutual fund is a collection of stocks and/or bonds that brings together a group of people to invest their money collectively in diversified securities. Each investor owns shares, which represent a portion of the holdings of the fund. Mutual funds allow you to diversify your holdings, lower risk and access a variety of holdings due to economies of scale. Shares would not permit you to obtain these objectives, especially if you are investing small amounts.
Some diversified equity funds to look at (for investing with a tenure of 3-5 years) are DSP BR Top 100 Fund, Sundaram Select Midcap Fund, HDFC Top 200 Fund, DSP BR Equity Fund and Benchmark S&P CNX 500 Fund. However, your allocation to them would depend on your risk appetite as this represents a basket of large cap, midcap and multicap funds.
From Your Expert @ InvestmentYogi