When to get in: Too often I am asked, ``Is it a good time to make an investment?'' The answer, curiously enough, is always the same. Right now. The best course of action for most people should be to invest immediately. It is nearly impossible to predictably time the market on a regular basis. So the best realistic action an investor should take, based on our hypothetical study, is to invest at the first possiblemoment, regardless of the level of the market.

The waiting game is far too dangerous than investing immediately. Procrastination may be much worse than bad timing. The very worst returns by far belonged to investors who waited indefinitely and then never actually invested in stocks at all. It is much better to invest, even if on the worst time each year, versus not investing at all.

And periodic investing proves to be a sound strategy. It is well suited for those investors who are prone to regret their decision after making a large investment that does poorly in the short term, or those striving to invest smaller sums as they earn it. The new generation funds have made it possible, with little effort. Even if you have a lump-sum investment, you can invest in a debt funds with predictable returns and instruct your fund to move to an equity fund periodically.

When to get out: For investors, especially with equity exposure and long term perspectives, buy-and-hold is the easiest strategy and one thathas proven effective on a historical basis. What buy-and-hold really means is staying the course through short-term market dips.

However, when individual funds fail to measure up to market or peer performance, you should consider selling.

We studied to compare the classic buy-and-hold approach with a strategy of selling under-performing mutual funds on a periodic basis in an effort to achieve higher portfolio returns. The sample was equity funds and based on their five-year performance history only.

The key finding was that selling funds that under-perform their peer groups can lead to slight improvements in portfolio returns, without considering tax and transaction cost implications.

The best returns in the study came from selling funds that fell into the bottom quartile for performance (i.e., the lowest 25 per cent - funds that were outperformed by 75 per cent of their relevant peer group) on an annual basis.

The difference in annualised returns, however, was slight - only 0.42 per cent -suggesting that you consider the above strategy more of a guideline that a mandate.

Evaluating your fund's performance - along with your financial situation - every year is the critical first step in your decision-making process. Finally, when evaluating fund performance, make sure you compare your fund with the most appropriate peer group. Comparing ``apples to apples'' is the only fair way to see if a fund is doing well or under-performing.