You can take your pick but for starters stay with large cap diversified funds.

It's important to choose a good fund house -- a glance at how they have performed over the years should give you an idea of which have been the better performing fund houses.

The other way to get an exposure to equities is to buy what are called Unit Linked Insurance Plans which bring with them an insurance cover.

ULIPs are pretty much the same as mutual funds though many of them are expensive in that the upfront fees are rather high.

Again, there are several combinations of debt and equity that one can choose from. Remember, equity is risky, you must be prepared to lose money, but I'd say if you're young -- below 35,or even below 40 -- this is a good time to invest in the market.

You could put in as much as 30 per cent of your savings into equities.

The rest can be put away in what are call fixed-income instruments such as fixed deposits with banks or Government of India bonds.

They are safe and also liquid, because you can break an FD by paying a penalty, but they hardly cover you for inflation.

Image: Stock traders are reflected on the glass partition of a dealing room at brokerage firm Motilal Oswal Securities Limited in Mumbai. | Photograph: Indranil Mukherjee/AFP/Getty Images

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