Mutual Funds

Your Fund Portfolio

Parvatha Vardhini C | Updated on January 24, 2018 Published on February 08, 2015

I am 32. I have been investing ₹1,000 a month in each of the following funds — HDFC Capital Builder, HDFC Balanced, HDFC Mid-Cap Opportunities, ICICI Pru Focused Equity, Franklin High Growth Companies, Reliance Small Cap and ICICI Long Term Plan. I want to invest for the long term. Kindly review my selection.

Madhana Kumar

For a total investment of ₹7,000 a month, you have too many funds. There are multiple funds from the same fund house and there is also not much focus in the choice of funds. Limit your investments to ₹2,500 each in ICICI Focused Bluechip and HDFC Mid-cap Opportunities. The balance ₹2,000 can be invested in Tata Balanced. Since you already have a fund from the HDFC house, HDFC Balanced and HDFC Capital Builder may not be necessary. Considering your age and long-term perspective, ICICI Long Term Plan may be a tad conservative.

Although Franklin High Growth and Reliance Small Cap are quality funds, you can do away with them as you can get exposure to mid and small-cap stocks through HDFC Mid-Cap Opportunities itself.

I am 28 years old, married, with a child on the way. I earn about ₹41,000 per month. I have invested ₹4,000 in Reliance Small Cap, ₹5,000 in Reliance Tax Saver and ₹10,000 in HDFC Mid Cap Opportunities. I am looking at investing ₹10,000 per month. How should I define my investment philosophy?

Karan Jain  

Since you have a growing family, you can direct your savings towards the higher education expenses of your child.

Considering that you are quite early into your career, investing in an ELSS (equity-linked savings scheme) fund is a good idea , to both save taxes and generate inflation-beating returns.

It would be preferable to put small lumpsums in tax funds as each SIP instalment is locked for a period of three years. Split the ₹10,000 as follows : Invest ₹3,000 each in Birla Sun Life Top 100 and Axis Equity, two large-cap focused funds with a good track record. Park ₹2,000 each in HDFC Mid-cap Opportunities and Reliance Equity Opportunities.

If you invest ₹10,000 per month for 18 years and your funds earn a conservative 12 per cent return per annum, you will have a corpus of ₹75 lakh.

As your surplus increases, you can start investing for other goals such as your retirement. Make sure to review the performance of these funds periodically.

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Published on February 08, 2015
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