As the end of the tax year looms, it is easy to predict a great number of ISA investors will panic-buy whatever stocks and shares ISA seems the best option.

Yet as with any hurried decision, this can leave you dazzled by past performing tables and subsequently with a bad deal.

Jason Hollands of advisory firm Bestinvest, sets out seven top tips on how to go about choosing an ISA fund:

1. Step back and think about your overall strategy. When you are up against a deadline it is easy to get sucked into a fund selection process before first stepping back and doing the necessary strategic thinking.

Before putting any new money into the market, investors should first reappraise their goals, appetite for risk and likely time horizon.

This should be key to driving their choice of how to spread their investments across different asset classes such as equities, bonds, property and absolute return funds.

2. Review your existing investments. It is vital to monitor your existing investments closely as even a portfolio which was well put together at the outset will drift over time, as markets and asset classes perform at different paces.

This can mean a more cautious portfolio has progressively become higher risk or vice versa. It is also important to check that your individual investments are performing well.

In the context of “ISA season” appraising your portfolio will help you understand the areas where it is weak or already too heavily weighted and therefore where any new ISA investments should potentially be focused.

3. Focus on the areas which look good value, don’t chase past performance. During “ISA season” it is all too easy to get swayed by whatever funds are riding high in the past performance tables, yet this really is no guide to the future as you are buying last year’s story where the upside may have already played out.

The art of successful investing is to buy shares or bonds when they are cheap and cash out when they are expensive. Yet people often do the exact opposite, following the crowd. Of course the challenge is that there are many ways to value investments.

Right now we believe bonds, which have been very popular with ISA investors in recent years, look expensive and the income yields they offer are low.

In contrast, with the exception of US shares, equities generally look good value compared to where they have traded over the longer term, especially those in latterly unloved markets such as Europe, Japan and Emerging Markets.

4. Diversify across asset classes, geographies, the market cap spectrum, duration, investment styles and managers. Academic studies, including those by Brinson, Hood and Beebower (1986) and Ibbotson and Kaplan (2000) have concluded that well over 80% of the variances in portfolio returns come from asset allocation decisions rather than stock selection, so it is worth investing some time thinking about this before getting into the process of selecting individual funds.

Diversification should help reduce overall volatility in your portfolio, as well as expose you to a wider set of opportunities.

The mix between general categories such as equities, bonds and property is the starting point but then you need to delve into achieving a good mix across geographies and the spread between small, large and medium sized company shares and the right mix between government, corporate and high yield bonds for any fixed income exposure.

The industry profile of different geographic markets varies enormously as well. For example, investing exclusively in UK equities will potentially result in a very high weighting to oil and gas companies and banks as these represent a large proportion of the UK stock market.

By adding exposure to markets such as Japan and the US, you will achieve diversification to areas such as technology and consumer goods companies for example.

Also, there are many ways to invest: passive, active, a focus on value or momentum. None of these is a panacea and each will work well at different points. It therefore makes sense to blend a variety of investment approaches within a portfolio.

5. Be disciplined in structuring your ISA portfolio. It is easy to get into the habit of continually adding new funds each year into your ISA as you get swayed by competing tips and marketing hype. If you are not careful, your portfolio can turn into an unwieldy museum of funds that were popular in the past, making the portfolio more difficult to monitor and watering down the positive impact of the very best funds you hold. Set a discipline of having no more than, say, 15 to 20 funds as a maximum. If you are tempted to invest in a new fund, reassess whether it should replace one of the existing funds. This will force you to challenge yourself on the case for continuing to back each fund, as they will need to prove they deserve a coveted place in your portfolio.

6. Watch out for costs. Investing is full of uncertainty as none of us has a crystal ball to the future. However, one of the few things that can be predicted with some reliability is the drag impact of fees and expenses on future returns.

This does not mean the lowest cost fund is always the best, but it does mean that the higher the fees on a fund, the greater the conviction you should have in the ability of the manager to deliver outperformance net of charges. And it also means you need to have confidence that your adviser or broker will do a good job at monitoring you portfolio.

One way to cut costs is to use passive investments such as index trackers and Exchange Traded Funds but these are only as good as the index they follow and so while they have a role to play in a portfolio, they aren’t a total solution.

At Bestinvest we can help reduce costs on active funds by cutting initial fees to zero and through annual loyalty bonuses.

7. Execute carefully to reduce market risk. It can be uncomfortable when you invest a lump sum only to find a week later the investment has fallen in value, even if this shouldn’t really matter if you are investing for the long-term.

You can reduce this risk by securing your ISA investment with a lump sum in cash and then drip-feeding money into the funds you have identified for investment in a series of tranches over a period of time. This will help even out the effects of any volatility in the price you pay.

In summary, it is important to plan your investment ISA selection carefully so that it supports your overall goals and complements any existing investments you have.

Investors who feel they don’t have time to do this before beating the end of tax year deadline need not panic.

They can secure their ISA allowance with cash by the deadline and then take time to decide the appropriate investments to select after the end of the tax year.