Are you working hard to keep everything in your life BALANCED? I am sure, who does not want to lead a balanced life.. Staying balanced in the midst of your life is a true feat.
A well balanced life is very much essential for personal effectiveness, peace of mind and living well. We all would like to maintain a balance between professional and personal life. Both are equally important to lead a successful, happy and healthier life. We need to have a right and well-balanced diet to be healthy and fit.
Investing in Balanced Mutual Funds is not much different. Balanced funds are also known as Hybrid Mutual Funds. Personally I prefer investing in balanced funds to achieve my medium and long-term goals. I am a strong advocate of Balanced Funds. (Read : My Mutual Fund Portfolio)
Whether you are a new or an experienced investor, investing in balanced funds can be fruitful. They can give you Diversified Equity funds like Returns but with a lower risk profile.
Last year in the month of June (2016), I had published an article on ‘ Best Balanced Mutual Fund Schemes ’. One year gone by, so let’s review the performance of these top performing balanced funds and let’s have a look at the new list. But, before that, let’s discuss on the basics of Balanced Funds.
What are Balanced (or) Hybrid Mutual Funds?
Mutual funds are broadly classified as either Equity or Debt,based on where the funds are invested.
- Equity funds primarily invest in stocks/shares.
- Debt funds primarily invest in Bonds, Government securities and Fixed interest bearing instruments. (Related reading : ‘Types of Debt Funds‘)
- BALANCED FUNDS invest in both equity and debt instruments.
What are different types of Balanced Funds?
Balanced mutual funds can be Equity oriented or Debt oriented hybrid plans.
If the average equity exposure of a balanced fund is more than 60% and the remaining 40% is in debt products then it is treated as an Equity Oriented Balanced Fund. This means major portion of the fund’s assets are invested in equity (stocks).
If the average debt exposure is around 60% and equity is 40% then these funds are treated as Balanced funds – Debt oriented. (These proportions can vary among different balanced fund schemes).
As per my last review on Top performing Balanced Funds, I had earlier suggested below schemes ;
- HDFC Balanced Fund
- TATA Balanced Fund
- ICICI Prudential Balanced Fund
- Birla Sun life Balanced ’95 Fund
- SBI Magnum Balanced Fund
- HDFC Children’s Gift Fund
As HDFC Children’s Gift Fund may not be suitable to everyone, so I have included a regular balanced fund in its place, which is L&T Prudence. (Last year, I have suggested to keep an eye on L&T Prudence’s performance.)
If you have invested in any of the above Funds, you may continue with your investments in them.
Top Performing & Best Balanced Mutual Fund Schemes & Returns Analysis
Below are the top and consistent performances under Balanced (Equity oriented) category ;
- There are around 61 Balanced (Equity oriented) Schemes. The Category’s average returns have been around 12% for the last 5 years.
- HDFC Balanced fund has been one of the best consistent performer under ‘Hybrid-Equity’ fund category. The fund’s last ten year record is as good as some of the best pure Equity funds. This fund generally allocates 70% of its corpus to Equities and the remaining balance is invested in Debt Securities. The fund’s investment strategy has been aggressive when it comes to allocation of corpus to mid/small stocks, when compared to its peers. This fund has a very low portfolio turnover (Portfolio turnover is a measure of how frequently assets within a fund are bought and sold by the managers). The last 5 and 10 year returns are 19% and 16% respectively.
- Birla Sunlife’s Balanced Fund (’95) is one of the oldest available balanced funds and has also been a consistent performer. This fund has an allocation of around 71% (May 2017) of its corpus to Equities and around 19% has been invested in Debt oriented securities. Around 23% of its Equity allocation has been invested in Banking & Financial Services sector.
- L&T Prudence Fund, though relatively a new entrant in this category, it has been performing really well for the last few years or so. It has beaten its benchmark and peers by impressive margins over the last four years. The Fund’s risk grade is ‘below average’ and return grade is ‘above average’. It has an allocation of around 69% to Equities. The fund’s investment strategy has been a ‘multi-cap’ approach with slightly higher allocation to Mid/small cap stocks. Whereas, it does not take much risk with Debt securities and primarily allocates debt corpus to less risky bets like Sovereign Debt, Bonds & Treasury investments. We need to see how this fund performs in a bear market (as this fund has been launched in 2011 only).
- ICICI Prudential Balanced Fund has an Equity allocation of around 65% and around 28% of its corpus is invested in Debt securities. Its performance during the last 5 year period has been quite impressive.
- SBI Magnum Balanced Fund has been inconsistent until 2011 (with patches of bad and good performances). However, this fund has been performing well since 2011-12. This fund typically maintains a 75-25 equity-debt mix. The equity part is multi-cap, with 50% allocation to Large cap stocks and 50% allocation to mid/small cap stocks. In the Debt portion, about 50% is invested in G-Secs.
- TATA Balanced fund has been one of the star performers under Balanced Funds category. However, its performance has not been up to the mark for the last 1-2 years. The fund’s three and five year returns have beaten its benchmark by around 10% and its category by 5% points. But the margin of out-performance has narrowed in the last 1 -2 years. Its standard deviation has been slowly inching higher. Nevertheless, it is still one of the best consistent performers for the last 10 years or so. Its 10 year returns have been around 14%, next best to HDFC Balanced fund.
- Two more balanced funds to watch out for are Franklin India Balanced Fund & DSP Blackrock Balanced Fund. Let’s keep a track of their performances.
Best Equity Oriented Balanced Mutual Fund Schemes & Risk Ratios
Let’s have a look at the Risk ratios of these top performing & best Balanced Mutual Fund Schemes; 
(Sorted based on overall ‘Fund Risk Grade’) (Source : Valueresearchonline.com)
In case, you have to pick a balanced fund out of these top performing balanced funds as per your requirements, you need to give importance to both returns and measures of volatility. You may analyze various ratios as given in the above image and select the one which is the best for you.
Ideally, the fund should have lower Standard Deviation, low Beta, high Alpha and so on..
Suggest you to kindly go through my article ‘how to pick right mutual fund scheme?‘ for the detailed explanation on various types of risk ratios.
The main benefits of investing in a balanced fund are;
- Diversification : The funds are invested in both equity and debt financial securities leading to diversification of investments.
- Asset Allocation & Re-balance : Balanced funds regularly re-balance the portfolio based on market conditions & asset allocation limits. An investor is, thus, saved the hassle of manually re-balancing the portfolio. But it is prudent not to remain invested in these funds till your reach your Financial Goal target year. You may have to switch to safer investment avenues as you reach your target year. (Related reading : ‘List of best Investment Options‘)
- Low volatility : Balanced funds are less risky compared to pure Equity funds. Equity portion will provide the capital appreciation through stock prices appreciation and dividend income. Whereas, Debt portion can provide stability through interest income and appreciation in Bond prices.
- Long Term Capital Gains : In terms of taxation, the balanced mutual funds that invest at least 65% in equity (Equity oriented) attract no tax liability on Long Term Capital Gains. The units of these funds should be held for more than 12 months. (Related Reading : ‘Capital Gains on Mutual Fund & Tax implications‘)
- You can consider balanced funds for your medium to long-term goals like Retirement Planning or for Kid’s Higher Education goal planning.
Have you invested in any of the balanced mutual fund schemes? Do you believe that one should include a balanced fund in his/her long term MF portfolio? Kindly share your views. Cheers!
(References : moneycontrol.com, valueresearchonline.com, morningstar.in & freefincal.com) (Post Published on : 19-June-2017)
How to link Aadhaar number to Mutual Fund Investments online?
Top Balanced Mutual Funds – Benefits & analysis of past Returns
RBI’s statistical Data on the Indian Economy (2016) – How do we (Indians) save and invest money?
ELSS Dividend Reinvestment option – Phased out
Hi Sree
I have around 2 Lakhs to invest for a period of 1 year.
Around 1 lakh i want to invest in a moderate risk option with higher returns.Liquidity : within 15 days is fine
Around 50000 i would like to invest in an arbitrage fund.(hoping they offer more returns than fixeddeposits and liquid funds)
Around 50000 i would like to invest in some aggressive investment options which can give me very high returns.
Please suggest me some good funds for each category.
If you have any other suggestion for investing this amount for a period of 6months to 1 year please suggest that too.
(For around 75% amount i’m ready to take moderate risk and remaining 25% can take high risk).
Dear Vishnu,
Investment option for 15 days????
Kindly read :
Arbitrage Funds – review
Types of Debt Funds
List of investment options
Hi Sree
I meant , if i want to withdraw the amount from these investments (without completing its tenure) then i can wait for 1 to 15 days to get it redeemed to my account .
Dear Vishnu,
Kindly note that we can’t expect very high returns from debt funds and that with an investment time-frame of around 1 year.
Kindly go through earlier suggested articles.
You may consider Liquid funds, Ultra short term debt funds / arbitrage funds.
Hello Sreekanth.
I am having a bank FD of Rs. Nine Lakh earning 8% annual interest for a duration of 6 years. Interest income of Rs 6,000 comes to me monthly I come in 30 %tax bracket.
In order to avoid tax and to preserve the initial capital,I wish to go for a Balanced fund – Direct, Growth with monthly SWAP withdrawal @9%per annum which works out to a monthly withdrawal of Rs 6750. I can keep the fund for next 6 years or more
Do you think, I am doing the right thing. Do you think my initial capital is unlikely to erode and my SWAP will come from increase in NAV?.Should I opt for HDFC or ICICI or L&T or dividedmy portfolio equally among these three mutual funds
Regards
Vinod
Dear Vinod,
May I know if monthly/periodic withdrawal is your requirement or you just want to withdraw certain amount from equity fund??
If fixed period income is your requirement, considering your tax bracket, and if you can afford to take moderate risk – Setting up SWP from a Balanced fund is effective and makes sense.
Time-frame of 6 years is fine.
However, there is no guaranteed that capital erosion will not happen, as returns from MFs are not fixed.
“When you’re invested for the long term, your average return becomes much more stable over time and it’s less likely that you’ll lose money. Various studies show that as we lengthen our investment horizon, the average annual rate of return over that timeline becomes less variable.”
Thanks Sreekanth for your valuable guidance. I am thinking of foreclosing my bank FD and investing Rs 9 Lakh in Balanced fund with SWP of Rs 6750 every month. My time horizon of holding the fund is above 6 years.
Can you kindly advise whether I Should I opt for HDFC balanced fund, or ICICI Prudential balanced or L&T prudential or alternately divide my portfolio equally among these three mutual funds
Dear Vinod..Given a choice, I will consider HDFC balanced fund.
Kindly read : How to pick right mutual fund scheme?
Hey Sreekanth ,
I have made one portfolio for my Mother too !!
1) SBI bluechip : 2000pm
2) ICICI Pru Balanced : 1000pm
3) Principal Emerging Bluechip / HDFC Mid Cap : 1000pm
4) Franklin India High Growth Company Fund : 1000pm
ELSS:
Birla Tax Relief 96 fund : 5000pm
Tata India Tax Saving / Franklin Tax Shield : 5000pm
Please advice if any corrections needed
Investment horizon is around 10-12 Years
and For How long we must continue ELSS funds (each SIP) for a decent return
Dear Bharat ..Looks fine..Kindly check their portfolios overlap %s..
After reading your blog and 2-3 interactions with you…I have made this Portfolio for me (My age :22 years)
Birla Frontline Eq Fund-G : 3000pm
HDFC BALANCED FUND : 1000pm
SBI MAGNUM MULTICAP :1000pm
Mirae Emerging Blue Chip : 1000pm
Franklin small company fund : 1000pm
ELSS :
Franklin India Tax Shield : 5000pm
Axis long term Equity : 5000pm
Overlapping are more among Large-Multi , Large-ELSS , Large-Balanced but that still less than 40%
For rest combinations , it is below 20% overlap. Please suggest if i should change any fund
Time horizon is more than 15 years.
Dear Sreekanth,
Thanks a ton for for the valuable and continuous articles on personal finance. I am 32 and have an unavoidable fixed deposits/debt based investments of 13K/month and accordingly want to invest in Equity. My aim is long term wealth creation and I have zeroed on to below portfolio. Pls comment/recommend necessary changes:
1. Axis Long term Equity Fund – Growth/Direct – 5000/month.
2. Mirae Asset Emerging Bluechip Fund – Growth/Direct Plan – 5000/month.
3.ICICI Prudential Value Discovery Fund – Growth/Direct Plan – 4000/month.
Dear Sunny,
2 & 3 are fine.
Axis LTE is it for your tax saving too?
No, Axis LTE is not for tax savings. Sec 80(C) is already crossing without mutual funds. Please comment on Axis LTE . I also request you to recommend me 1 additional fund(apart from the above mentioned three funds) for Rs.5000/month SIP.
Dear Sunny,
If so, instead of Axis fund you may add one more diversified equity fund or a mid-cap fund. Ex: Franklin High growth companies fund or HDFC Mid-cap opp.
And one equity oriented balanced fund to your portfolio.
Hi Sreekanth,
After taking your advice and a little bit of study, I have short-listed following 5 funds for long term (>15 years) wealth creation:
Diversified:
1. Motilal Oswal Focused Multicap 35 Fund-G/D – 5000/month.
2. ICICI Prudential Value Discovery Fund-G/D- 5000/month.
Mid Cap
3. Mirae Asset Emerging BlueChip-G/D – 5000/month.
4. Franklin India Prima Fund-G/D- 5000/month.
Small Cap
5. DSP Black Rock Micro-Cap Fund-G/D- 5000/month.
I have an unavoidable debt related investments of 13K/month(PPF etc). I request you to kindly re-assess and recommend any modifications in the above mentioned plan-A for 25K/month in pure equity funds. Separately, I also request you to remove any one of the above funds for a Plan B for 20k/Month.
Thank you.
Dear Sunny,
All the listed funds are good ones.
The new investments in DSP micro cap fund have been temporarily suspended. Alternatively, you may consider Franklin Smaller cos fund.
You may add one equity oriented balanced fund instead of small cap or one mid-cap fund.
Kindly read :
MF portfolio overlap analysis tools
Dear Sreekanth,
Thank a ton for the valuable guidance and advice 🙂
Hi Sir,
Thanks for giving these helpful details, I have prepared a folio for long horizon (5+years), can u please suggest t if this is fine.
1. UTI Mid Cap Fund – Direct Plan (G) -Rs 2000
2. ICICI Prudential Value Discovery Fund – Direct Plan (G) – Rs 1500
3. ICICI Prudential Top 100 Fund – Direct Plan (G) -Rs 3000
4. ICICI Prudential Mid Cap Fund – Direct Plan (G) – Rs 1500
5. HDFC Mid-Cap Opportunities Fund – Direct Plan (G) – Rs 1500
I am planning for HDFC balanced fund to add in folio with Rs 4000. Is this correct decision?
If any changes are required please suggest. Thanks for your help.
Dear Gourav,
You may drop UTI mid-cap fund.
ICICI Value discovery + HDFC Balanced fund + one large cap fund can be considered. (Ex : SBI Bluechip / Birla Frontline equity)
Thanks for suggestion,
So should i need to go with only 3 funds in portfolio as suggested and remaining (UTI Mid cap + ICICI Prudential Top 100 + ICICI Prudential Mid Cap + HDFC Mid-Cap Opportunities) need to stop. If Need to stop then can i leave money in them or should redeem.
Regards,
Gourav
Dear Gourav,
I have assumed that you are yet to invest in these schemes..
Too many funds especially from same fund category can be avoided..Kindly read :
MF Portfolio overlap analysis tools
How to pick right mutual fund schemes?
No Sir, i have already invested in these except HDFC Balanced Fund.
Dear Gourav,
Since you have time-frame of around 5 years, suggest you to retain only one mid-cap fund (preferably HDFC mid-cap) and may allocate higher amount to Large cap & balanced funds.
Thanks Sir
So if i need to continue other invested mid cap funds then tenure should be 10+ years?
Dear Gourav,
When you’re invested for the long term, your average return becomes much more stable over time and it’s less likely that you’ll lose money. Various studies show that as we lengthen our investment horizon, the average annual rate of return over that timeline becomes less variable.
Kindly read : Long Term Investment Horizon : Importance & Benefits | My father’s risky investments! (Real-life examples)
Dear Sir,
I have very less capital of Rs. 80k which i want to invest in Mutual fund for short term goal i.e 1 year and don’t go through the Bank since interest rates are very low in bank..
Pl advice some MF’S name as well as category so that i can earn better monetary benefit compare to Bank.
Dear Jayesh,
If you are aware of the risks associated with debt funds (if you can afford to take some risk), you may consider Short term debt fund and/or Arbitrage fund.
Ex : Franklin Low duration fund / ICICI Equity arbitrage fund.
Kindly read :
Types of Debt Funds
What are Arbitrage funds?
Hallo Sir
i am new in the field of Mutual fund , 10 years remain in my service retirement. As per friends suggestion I am investing in
a) SBI blue chip-5000
b) mirae india opportunity fund- 5000
c) DSP blackrock small and mid cap-2500
d) mirae emerging fund-2500
e) motilala oswal most focused multicap 2500
i can invest upto 25000 rs per month. pl advise
regards
bb jha
Dear Mr Jha,
You may pick either of the first two a) or b) under large-cap category, as these fund’s portfolios overlap by around 45%.
Kindly read:
How to check mutual fund schemes’ portfolio overlap?
What are the different types of fund categories?
You may go ahead with the other investments!
Thanks Sreekanth for the verygood artical/information, please suggest me
my Age 35, owned home, No Loan.
below 19K SIP investing (since 2010 and some started in 2014)
6k (sector fund) – 2k reliance pharma + 2k Reliance Banking + 2k IcICI Technology
5k (ELSS) – 2k Axis Long term + 2k Reliance tax saver + 1k DSPBR Tax saver
2k (balance) – 2k icici Balanced fund
2k (gold) – 2k Reliance Gold Saving Fund
2k (Diverified) – 1k icici discovery fund + 1k Reliance Equity Opportunity
1k (Large cap) – 1k ICICI Focused Bluechip
1k (Divident) – 1k ICICI Dividend YieldnEq. Fund
FD – 5Lac(renew every time)
EPF – 80K/year(my+employer contribution)
PPF – 60k/year
RD – 5K/month
Goal – max possible wealth creation(child education, retirement)
tenure – minimum 15year to max 25 year
Please suggest is it good portfolio or suggest any modification
+ i want to invest 6k/month – which sip i add it or take new sip ?
Dear Bhushan,
Appreciate your long term investment strategy..
I believe that you can trim your portfolio a bit. You may kindly check the portfolio overlap among the funds (except the Gold fund).
You may replace ICICI Div yield fund with any good Mid-cap fund.
Instead of Reliance opp fund you may add one balanced fund to your portfolio.
Kindly read :
How to pick right mutual fund schemes?
Best Equity funds
What is 200 Day moving average?
Dear Sir,
I have been investing 6k per in Mutual fund since last 1.5 years, My portfolio and goal is as below.
Axis Long term equity fund —— investing 1,000/- per month
Birla Sunlife Manufacturing Equity Fund—— – investing 1,000/- per month
DSP Black Rock Micor Cap Fund—– investing 2500/- per month
ICICI Value Discovery Fund—-investing 1,500/- per month
My Current Age is 30 years and i am having on LIC policy with SA of 2 Lakh (Jeevan Anand) & looking for Term Insurance.
Axis Long term equity fund —— 20 years for retirement
Birla Sunlife Manufacturing Equity Fund—— – 20 years for retirement
DSP Black Rock Micor Cap Fund—– 10 years to get benefit for child education current age is 6 years old.
ICICI Value Discovery Fund—-5 years for planning to purchase Motor Car upto the value of 4 Lakh.
I have been working in an insurance industry and earning 25k per month & getting Health insurance from my employer.
Should i continue with my above goal or need to do some changes.
Pl advice and suggest.
Dear Karan,
You may consider investing in an equity oriented balanced fund instead of multi-cap fund for your 5 year goal.
Kindly do understand that sector/thematic oriented funds have high risks, you may consider replacing Manufacturing fund with a good Mid-cap fund instead.
Once you buy a term plan, you may discontinue the existing life insurance policy.
Kindly read :
Best Term insurance plans
Best Equity funds
Traditional life insurance plan – a terrible investment option?
How to select right mutual fund scheme?
Dear Sir,
Thanks for providing such an important information regarding wealth creation.
Should i discontinue with my existing two MF’S and replace with another.
1) Birla Sunlife Manufacturing Equity Fund replace with L&T Business cycle fund
2) DSP Black Rock Micro Cap Fund replace with Franklin India Smaller Cap Fund.
Rest two funds- Axis Long Term Equity Fund & ICICI Value Discovery fund looks fine.
Pl advice and suggest.
Dear Karan,
If you have existing SIPs in DSP Micro cap fund, you may continue with it.
Instead of birla fund you may pick any good mid cap fund for long term. Ex : HDFC mid-cap opp or Franklin Prima fund etc.,
Dear Sir,
I am already having Multi cap fund- Icici Value discover in my portfolio, if i’ll choose Franklin Prima fund , there may be chance of Overlapping.
Should i invest in Large Cap fund like Birla Frontline equity or Icici pru focus Bluchip fund etc.
Pl advice.
Dear Karan,
Kindly note that Franklin Prima is a mid-cap oriented fund, whereas Franklin Primaplus is a multi-cap one.
Sir,
Finally i have decided my MF portfolio which is below.
1.)Axis Long term equity fund —— investing 1,000/- per month
2.)Birla Sunlife Balanced ’95 Fund—— – investing 1,000/- per month & recalling existing BL Sunlife manufacturing equity fund
3.)DSP Black Rock Micor Cap Fund—– investing 2500/- per month
4.)ICICI Value Discovery Fund—-investing 1,500/- per month
I am looking for another SIP under Large Cap category for investing 1,000/- per month.
Pl suggest….
e
Dear Karan,
You may pick – Birla Frontline equity / SBI Bluechip fund.
Sir,
Should i switch my existing Birla Sunlife Manufacturing Equity fund & utilized 2700 units against Birla Frontline equity.
Pl suggest.
Dear Karan,
Yes, you may consider it.
But kindly do note that SWITCH is also considered as normal redemption, so watch for any Exit load / tax implications (if any)..
Hi Sreekanth,
I am an ardent follower of your blog and have been investing in MFs for close to 2 years now- almost fully basis this blog 🙂
So, thank you!
I seek your guidance on how often and how to check whether my MF portfolio needs any reshuffling?
Also, in case I do realize there is need to shuffle, how do I go about it- as in how can I move from one fund to another without losing on the benefit of staying invested for long periods?
Thanks!
Gaurav
Dear Gaurav,
Thank you for being a loyal reader!
Ideally, you may review your portfolio’s performance once in 6 months, but reshuffling only if it is required may be say in 2 years or more than that.
Personally, once I invest in a consistent performer (MF Scheme), I stick to my conviction and give it a sufficient time (for example I am with UIT midcap for the last few years, though it has been not performing well for the last 1 year) before making a switch.
If switching is required, you may to have redeem the units and re-invest in the newly selected scheme, do watch out for tax and/or exit load implications (if any).
Hi Sreekanth,
Very nice article, I wanted to invest in Balanced fund since long now I can start investing in this category.
However, below is my current portfolio as SIP.
1. Axis Long term Equity (ELSS – 5 years Loc-in) – 2000 RS.
2. Mirae Asset Emerging bluechip (Mid-Cap) – 2000 RS.
I am planning to invest in two more fund category mentioned below, kindly suggest if adding below category funds will be good for my portfolio interms of fund allocation and diversification and how much amount of SIP to be considered for below ?
1. Large cap / Multi cap (Long Term horizon 8-10 years)
a. SBI Bluechip Fund (Large)
b. BSL Frontline equity fund (Large)
c. ICICI Pru focued bluechip Fund (Large)
d. Kotak select focus (Multi)
e. Franklin High growth Fund (Multi)
f. DSPBR Opportunities fund (Multi)
2. Balanced Fund (Medium Term 3-5 years)
a. HDFC Balanced
b. BSL Balanced ’95
c. L&T India Prudece
Thanks,
Mittal.
Dear Mittal,
All the listed finds are good ones. You may pick 2-3 funds (Large/Multi/Balanced categories) and plan your investments.
Suggested reading :
What is large/Mid/Small/Multicap fund category?
What is 200 Day moving average?
Hi Sreekanth,
Thanks for your suggestion, I have one doubt about SIP Amount.
SIP amount should be kept same for all the categories or it has to be different for different category funds to diversify the investment.
For example, If I have SIP of RS. 2000 in Mid Cap then do I need to SIP of more than RS. 2000 in Large/Multi or Balanced Fund to balance or diversify the investment.
What do you suggest would be the ideal scenario.
Thanks.
Dear Mittal,
As you have long investment horizon, you may allocate higher amount to diversified and mid-cap funds.
Hi Srikanth!! I have below funds as part of my portfolio.
1. Axis Focussed 25 – growth (Multi cap)
2. ICICI prudential balanced – growth (balanced)
3. Franklin India Smaller Cos Fund(G) (Small cap)
4. Reliance Small Cap Fund(G) (small cap)
I want to invest Rs. 2000 more in SIP. Please let me know if I should choose L&T India Value Fund-Growth ( Mid cap) or any balanced fund from the list in your article.
My investment horizon is long 10-15 years and my current SIP is Rs. 10000 / month. Thanks!!
Dear Nikhil,
I believe that there are better consistent performers under ‘Multi-cap’ fund category than Axis 25 fund.
You may add one Mid cap fund to your portfolio (or) consider increasing your allocation to Mutli-cap fund.
Kindly read :
Best Equity MF Schemes
How to select right mutual fund scheme?
Thanks Sreekanth for your valuable insights. Based on the blogs which you mentioned, I will be investing in below funds for this year:-
1. ICICI Prudential Value Discovery Fund-Growth (multi cap)
2. ICICI prudential balanced – growth (balanced)
3. Franklin India Smaller Cos Fund(G) (Small cap)
4. Reliance Small Cap Fund(G) (small cap)
5. L& T value fund
Also for my short/medium term horizon, I will be investing in Birla Sun Life Monthly Income Plan II Wealth 25 Plan-Growth.
Please suggest if this looks ok to you.
Thanks,
Nikhil
Dear Nikhil,
Portfolio is Ok.
Can you define your short-term horizon?
In case if your short term timeframe is less than 2-3 years, advisable not to consider Birla MIP fund.
Read : Best MIP Funds..
Thank you so much Sreekanth for your suggestions!!
Hi! i am looking for assistance in building up my investment portfolio. As of now, I am investing 5k in DSP tax saver. I have about 5-7k per month to invest for tax saving. Apart from tax saving i am considering investing in diversified equity or balanced. DSP tax save-a large cap ELSS, I am thinking of investing in mid or multi-cap elss. It would be favorable if you list some.I am interested in tax saving and investment, more of investment. I have thought of carrying investment for 5-6-7yrs time frame. Thanks.
Dear Nisha,
You may consider Birla Sun life ELSS funds.
Kindly read : Best ELSS funds..
But, do kindly note that funds’ portfolios can change over a period ..
Hi Sir – I am currently doing following SIP, i need your inputs if this is good for long term investment 7-10years
BSL Manufacturing fund – 2000SIP
SBI Magnum mid cap fund – 2000SIP
HDFC Balance fund – 2000SIP
Canara Robeco Emerging – 2000SIP
ICIC PRU Focused Blue chip – 1000SIP
L&T India value fund – 1000SIP
your suggestion would be helpful….
Apart a general asking is can i expect always good return in long term from any of the fund or I need to review in yearly basis, but what are the parameters like peer comparion or benchmarks??
thanks/Mona
Dear Mona,
Given a choice, I will switch from BSL Manufacturing fund to HDFC balanced fund and ICICI Focused bluechip.
You may have review your portfolio performance periodically.
Kindly note that it is next to impossible to be with the best or STAR performers for longer period. What matters is consistency. Its ok to be in top 10 if not in top 3 best funds.
Do track your overall portfolio returns, in case if any fund is not doing well, compare its returns with its fund category average returns, benchmark returns and peers returns. Do not churn your portfolio based on short term bad performance , give the funds some time and then you may decide to replace it or not.
Kindly read :
How to pick right mutual funds scheme?
MF portfolio overlap analysis tools
How to create a solid investment plan?
My MF picks
Dear Sir,
thanks for your inputs………. I also have RD (5000 per month – done @ 9.25%) – 4yrs gone for 10 years horizon, on 10th year I will get approx 9.30lacs .
I want to shift the money towards Equity & need your advice if
– I stop this RD & put lumpsum amount which is accumlated till now – approx 3lacs (which fund pls??)
– start SIP of 5k
For a horizon of 10years??
do you think it’s good idea OR should i stick back with RD only since ROI is good as debt product….. I already having Debt amount in PPF & already doing SIP as per my previous question from last 2years & time horizon is 10years
thanks in advance!
tks/Mona
Dear mona,
9.5% is a decent return, but kindly check what would be your real-rate of return after adjusting for taxes..
Kindly read : Why it is not advisable to invest in FDs/RDs for longer period?
The mutual fund schemes mentioned here really useful for the person who are looking for financial management. Thanks for sharing this blog. I think HDFC balanced fund could be beneficial and trustworthy.
Hai, I am 28 Years Old, i am recently starting SIP following Funds:
1) Axix LT Equty Fund Growth – 1500 (Present Hold Value 9ooo)
2) HDFC Mid-Cap Opportunities Fund Growth – 1000 (Present Hold Value 8000)
3) ICICI Prudential Value Discovery Fund Growth – 1000 (Present Hold Value 10000)
4) Birla Sun Life MIP II – Wealth 25 Plan – Growth – (Present Hold Value 2000) Stopped
5) Franklin India Smaller Companies Fund – Growth – 500 (Present Hold Value 1500)
6) SBI Blue Chip Fund – Growth – – 500 (Present Hold Value 1500)
7) Tata Retirement Savings Fund – Moderate Plan – Regular Plan – Growth- – 500 (Present Hold Value 500)
8) Reliance Small Cap Fund – Growth – 2000 (Daily Rs.100) (Present Hold Value 800)
9) BNP Paribas Balanced Fund – Regular Plan – Growth (10000 Lupsum Hold in Stating Price NAV Rs 10.00)
My investments horizon is long of apx 20 – 25 years. this Fund is Ok are any changes in Fund.
Presently My Monthly SIP 7,000/-
recently i am seeing Axis Nifty ETF – after open the fund i am seeting this returns aprox 850% above is it true.
and
presently Axis MF offer Axis Dynamic Equity Fund – can i invest this fund (Rs.10,000)
Dear Chiranjeevi,
Investing in too many funds may not be really beneficial.
Kindly go through below articles :
MF portfolio overlap analysis tools
How to pick right mutual fund scheme?
What are large/mid/small cap funds?
Best Equity funds
can you suggest which funds are continue
and
which are stopped.
Dear Chiranjeevi ..Did you go through above suggested articles? You may kindly analyse the portfolio overlap and may revert to me with your analysis.
Hi, I have invested in following funds:-
Franklin India Prima Plus Growth Direct – 2.50L
HDFC Mid Cap Opp Fund – 1.50L
Franklin Build India Fund-1.50L
ICICI Pru Multicap Fund- 2.50L
Additionally for debt, I invest 1.5L every year in PPF. I still have around 10L to invest in lumpsum. Should I continue in the above funds or go for new funds.
Dear sourav ..May I know your investment time-frame??
Hi Srikanth,
Thanks for your valuable suggestions. I want to invest 1,50,000 lump-sum amount in mutual funds for my child future. Present my child is 5 years old and I want to continue fund for 10 years.
1. Please suggest best mutual funds for 10 years period.
2. shall I invest in two or three funds or single fund is sufficient?
Thanks in advance,
Mahesh
Dear Mahesh,
You may consider a diversified equity fund + Mid cap fund + Balanced fund.
Kindly read :
Best Equity funds
How to pick right mutual fund scheme?
Kid’s education goal planning Calculator
I have started i-sip for wealth creation.
1) Mirae Asset India opportunities – 10k
2) SBI Blue Chip – 10k
I have another requirement to invest 5 to 7 lakhs lumsum for 1 year. Which fund gives atleast decent return? I expect atleast 8%, after tax. Can you suggest.
Ram,
Hi Shreekanth,
Sorry I have wrongly mentioned i-sip funds. Please see below right ones
1) SBI Blue Chip Fund – Direct Plan – Growth – 10k
2) Mirae Asset Emerging Bluechip Fund-Direct Plan – Growth-Growth – 10tk
Please suggest for i-sip and lumpsum requirement
Ram,
Dear Ram ..Both the funds are good. For lump sum investment, you may consider an Arbitrage fund and can hold the investment for just over 12 months, as the capital gains (if any) on Arbitrage fund is tax-exempt after 12 months.
Kindly read : What are Arbitrage Funds?
Hi Shreekanth,
I have started SIPs in
1. Birla Sunlife 95 balanced fund (Dec 2016)
2. ICICI Prudential balanced fund (From Dec 2016)
Now from this month I am planning to invest Rs 10000 SIP in Reliance Pharma
Also I am planning to invest in lumpsum
1. Rs 1 lac in Reliance Pharma
2. Rs 1 lac in birla advantage balanced fund
Please suggest
Dear Richa ..If you are aware and ok with high risks associated with Sector/Thematic oriented funds, you may go ahead.
You may check portfolio overlap among the balanced funds.
Hi Sree,
I have a query related to investment. As of now, I am new to mutual fund and yet to start investing. Planning to invest with SIP of 10 -12 K monthly. I am salaried , aged 32. Hence I can increase investments in next years. I have invested in PPF for last 4 years with 50-60K per year and plan to increase more. Have home loans till 2024
Financial goal:
1. To accumulate 5-6L in next 4 years. (MID TERM)
2. Long term (15-20 years) to accumulate good amount
Please suggest:
1. Should i start with Equity oriented, Debt or balanced MF or mixture of all for both the goals
2. In case of equity, which type would you prefer: large, mid, small, diversified.
Dear Iftikar,
Suggest you to kindly go through below articles, can give you some idea on investment planning, you may revert to me with more queries ;
How to create a solid investment plan?
Retirement goal planning & calculator
How to pick right mutual fund scheme?
What are large/mid/small cap funds?
hi srikanth ,
2 queries
1) i am having SIP of 4000 per month in tata balanced fund from last 2 years .. since std deviation is high , do you suggest to stop the SIP and move to another fund ..I also have 5000 per month SIP in hdfc balanced , do you suggest to put the tata balanced sip also to hdfc balanced ?
2) regarding small cap fund , whats ur opiunion on reliance small cap,..i have running sip in dsp microcap and franklin smaller co.s , is investing in reliance midcap for 10 years horizon is a good option ..i think std deviation of this fund also a bit high , but returns seems to be good .
thanks.
Dear Thomas,
1 – As of now, you may continue with your investments in both the funds. Keep an eye on TATA bal fund’s performance this year.
2 – If you have already invested in two small cap funds, that can be sufficient, adding one more small cap may not be required.
Kindly read :
Mutual fund portfolio overlap analysis tools
How to select right mutual fund scheme?
Sir,
I am an epf account holder. My last contribution is 10/2016. Upto march 2017 interest added. Still how much period shall I continue my pf account with epf office. When shall I draw the money. Please inform.
Dear PRABHAKAR .. Normally, an EPF accounts becomes in-operative after 3 years, during these three years, the interest is payable and gets accrued.
However, during last Financial year, the central Govt has announced that interest is payable even after 3 rd year.
But, EPFO is yet receive a notification on this, I guess..
Dear sir, I am your regular follower, last year I start investeing sip in hdfc balanced fund .
Sir the market is on higher side I want to add one more fund (hdfc midcap) in my portfolio.
Please suggest me it is the right time or I wait for sometime.
Dear HARMOHAN ..It is almost impossible to TIME the markets.
May I know your investment time-frame?
Sir,
These things are ok, yet to be listen. But I do not see any advise or tutorials regarding GST clearly. Because, most of the writeups are in complicated terms to understand by the ordinary people. can we have>>>>>>>>>>>> THANKS.
Dear SEKAR ..I have published an article on GST (Basics)..you may kindly go through it..click here..
Hi Sreekanth,
Thanks for the suggestions on the funds. Last year I have invested in HDFC Balanced fund after reading your article and I found it is good choice.
Hello Sreekanth,
I have recently come across your blog and I find it pretty useful for personal finance planning. Thanks for creating this blog.
I have a quick question not sure if this is the right platform to ask. Actually I am new to Mutual Funds but I would like to invest in some. I want to invest about 5 Lacs amount in some reliable investment with good returns. Is there any MF which can give me monthly income if I invest some lumsum amount ? Please let me know.
Thanks in advance. Waiting to hear from you.
Dear Manju ..Thank you for your appreciation!
May I know your investment time-frame?
Suggested reading : Best Monthly Income Plans of Mutual funds.
Hi Sreekanth,
Thanks for your quick reply. I shall go through the suggested article and get back to you. Bye for now..
Hi Sreekanth,
Few quick questions –
1)where can I approach for MFs?
2)If in banks do we have to submit form 15 for MFs ?
3)If I invest a lumsum amount say today when can I start getting monthly payouts ?
Dear Manju,
1 – You can invest online through respective MF websites / or online distribution platforms / industry sponsored online platform like MF Utility / through MF advisors.
2 – No TDS is applicable for MFs. Read : MF investments & tax implications.
3 – May I your investment objective(s) and time-frame?
Hi Sreekanth,
Thanks for your reply. Well my investment objective would be to see something similar to MIS in post office where I put some fixed amount and get monthly payouts for a stipulated period. I presume something similar can be done in MFs but not sure about the payout time frame? So, if I invest say 5 lakhs in MF as lumsum amount when can I get monthly payout and for how long ?
Waiting to hear from you.
Thanks
Dear Manju,
Kindly go through this article : What are Mutual Fund MIP Plans?
Nice article and I hav recently invested in HDFC balanced fund. Balanced funds are best especially when market crashes and the amount lost is less compared to other funds. Returns are pretty good especially in the longer run!
Dear Srikanth,
I am having home loan for 25 lakhs for 10 years period. 3 years emi payment completed. Now I am getting 10 L as lump sum from a sale proceed. Shall I pay this amount for my Home loan or shall I invest in equity mf. As home loan interest is less compare to MF returns (Say if I get 12% PA in equity which is more than my Home Loan Interest 8.6%)
Could you please advice.
Dear Harinath,
May I know your other important Financial goals and their time-frames?
Have you been adequately investing/saving for these goals?
I am having 5 financial goals. Two Children aged 12 years & 6 years old for their education & marriage. And my retirement after 15 years. I think all are long term goals (more than 10 years) only except first child Education expenditure after 5 years.
At present I am having total 30 L investments in MF. Some MF I invested are suggested by you in 2015.
I am having family floater health insurance & term policy.
My only liability is Housing Loan. Also this will not serve my tax benefits.
Thanks in advance for your prompt reply & guidance.
Dear Harinath,
Based on your profile, financial goals and current investments, suggest you not to pre-pay your home loan with a lump sum amount.
Instead, you may invest this corpus for your long term goals (especially for Kid’s education & your retirement).
Also, the home loan rates are reasonable, may remain so for atleast fr next couple of years…
I would suggest to prepay a portion to assuage our anxieties as this would definitely be nagging the conscience now and then. A peace of mind is an intangible benefit. Also the interest burden would come down.
This is really a very good article, Blogs are not just for socializing with others but it can also give us useful information like this. I really love your post, thanks for sharing this and looking forward to seeingfrom you more .
L&T India Prudence NAV has increased by 16% in last 10 months, HDFC Balanced is also close to it. Thanks for the review of Balanced Funds.
I am a follower of your blog from the past 6 months.your every article is very informative and trustworthy.I inspired by reading your posts.I need your advice regarding an investment strategy for my father(age 60) who is retired school teacher wants to park Rs 10 lakh at ICICI pru balanced Growth fund and starts a SWP of 10k every month from the 2nd year to fulfill the monthly expenses.Is it advisable to go ahead with this plan?
Dear Anindya,
May I know if he is going to be totally dependent on this income?
Can he afford to take risk by investing in an equity oriented scheme?
By the by, SWP is a good strategy
First of all thanks for your reply.
1.No this is for additional monthly income along with the monthly pension.
2.Though it is not purely equity so if he stay invested for 10+ years will not the risk will be minimized?
your advice regarding this will be highly beneficial for us. kindly respond with your valuable reply.
Dear ANINDYA,
If one invests Rs 10 Lakh assuming 10% return (on equity balanced funds), and withdraw Rs 10k per month then the accumulation can be Rs 6.5 Lakh after 10 years.
If he understands the risks associated with equity funds, you may suggest him to invest in balanced fund(s) and set-up SWP.
Also, any gains made after 12 months are tax-free.
May I know if he has adequate Health insurance cover?
Thanks for your valuable feedback.
By the way he has no health insurance cover.
Dear Anindya.. You may suggest him to take a health cover at the earliest.
Suggested readings :
Health insurance plans for Parents / Senior Citizens.
Important factors that need to be considered when buying a health insurance policy
Best portals to compare health insurance plans
You are really a wholehearted fellow.The way of your guidance is truly admirable.I wish you a good luck for ReLakhs.com.
Thank you, do share the articles with your friends and kindly keep visiting ReLakhs!
Hi Sreekanth, another nice article from your side.
I have 2 questions here:
1. As market is touching new highs every other day, do you think that it is wise to invest in equity oriented balanced funds. Balance funds invest in small/mid cap stocks as well. Don’t you think that large cap or debt oriented balance funds are better choice in today’s market scenario. My investment h0rizon is 5-10 years.
2. I have ICICI balanced fund in my portfolio. But its NAV is around 120+. Don’t you think it is wise to invest in some other balanced fund having low NAV. Suppose if i invest 1000 in a month and NAV is 100, i would be able to purchase only 10 units but if NAV is 50, i will be able to purchase 20 units. I am sorry if my question is very silly.
Thanks
NAV value and number of units do not matter when you are comparing 2 funds. If both the funds go up by 10%, you will have exact same notional profit in both – provided you have invested same amount in both.
Thanks for your response.
@Sreekanth, your inputs please for both queries.
Dear Saurabh,
1 – As you have long term investment horizon, advisable to invest as much as possible in Equity oriented funds. Your time-frame and investment objective(s) are more important that current market conditions.
2 – It is a misconception. Dont go by quantum of NAV. As opined by cvan..its the % of appreciation which matters.
1) both strategy is fine as long as it fullfil your asset allocation. Have said that for 5-10 year, if you can take little risk balance fund/large cap may fetch better return than debit fund post tax.
I want to invest 5 lacs in hdfc balanced via STP. So i decided to invest 500k in hdfc liquid fund and choose stp of 10k every month. So the cycle will continue for 4.2years for 10k as 50 STP installments. But as i read on your blog liquid funds short term fund so is my way is correct??
Short term fund means you need the money back pretty soon (for your expenses, investment etc.). So, obviously you want to put it in something that is not so volatile, liquid, has less risk of loss, preserves capital and does not lose out to inflation too much.
In my perspective, what you have done is fine.
Because think of the alternatives. If you had put that into a longer term income bond fund that goes down by 5% every time there is a 1% increase in the interest rate, now suddenly you are looking at a fund of 450k to STP from rather than 500k. It will probably come back up to 500k but after a significant amount of time.
On the other hand you can just keep the money in savings account and keep it safe with 4% interest only. However, now you are losing out on probably 1-2% additional income (and to inflation) that you could have got from liquid. In your case that is almost 5-10k. And liquid fund may just drop 0.2-0.3% or so (for example) for every 1% increase in interest rate. And it will very quickly recover too.
Thank you cVan for sharing your insights. Agree with you.
What is your opinion about canara robeco balanced fund?
Dear Cvan..Have you already invested in this fund (or) planning to invest?
I have invested some amount sometime back but also planning to start an SIP on it.
Dear Cvan.. If you are starting fresh SIPs, may be advisable to make future investments in some other balanced fund.
Thanks, will keep that in mind. I wanted to diversify a bit as the other premier balanced funds mostly invest in large caps. CR seems to have picked quite a few good small caps.
Dear cvan..The fund has invested around 20% of its corpus in Debt securities, as per Valueresearch data, the debt portion falls under ‘Low’ quality and ‘high’ interest rate sensitivity block, you may have a look.
Nice Article Srikanth
Thank you dear Suresh!
Sir
I want portfolio management like am investing 8000 per month in SIP
SBI CONTRA -2000
SBI MAGNUM GF-1000
SBI PSU -1500
L&T MIDCAP -3000
RELIANCE mf -500
I wanted to know whether this is right investment
My age is 34 and married with a kid of 3 years
Dear Deepak,
May I know your investment time-frame?
Can you expand the scheme names of 2nd & 5th funds?
Thanks Srikanth.This article is refreshing and timely.As market is forming new highs daily,most of the stocks and mutual funds have become expensive.Best time to invest in balance funds.
Thank you Doctor Ji !
Any time is a good time to invest, based on ones Financial Goals !