Top Balanced Mutual Funds – Benefits & analysis of past Returns

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• Hi Sreekanth,

  I have discussed my mutual fund plans with you some time back And initiated sips. My wife has an FD and RD maturing around July, total around 8 lac. I would like to explore Equity oriented Balanced MFs. (I am not forseeing any requirement for this amount for atleast 5-10 years; below my thoughts.

  Invest 5 lac in an equity oriented MF, and open an FD for 3lac.
  I'm considering HDFC Children gift plan, HDFC Balanced or ICICI balanced. I already have HDFC Balanced fund as part of my monthly SIP portfolio, so leaning towards 2.5 lac in HDFC Children gift and 2.5 lac in ICICI balanced, + 3lac in FD. is this a good idea? Considering balanced approach for wife as majority of my investments are in Equity Large Caps and Mid + Small MFs.

  Also let me know the procedure for opening MF for an NRI status individual. Both FD and RD are in NRE account. (Also note that She is a First time MF invester and do not have a PAN).

  Thanks!

  • Two clarifications;
    1) The invester is not in US/ Canada - heard some restrictions for US based NRI
    2) The invester is planning to return to india in 1-2 years.
    3) investment has to go out from NRE account and redumptions has to come back to NRE or Savings Account. (NRE account may not be active once the invester returns to India; What to do in this situation?)

    Thanks!

    • Dear Noble,
      Not exactly restrictions but need to meet some compliance checks. Invest in MFs with NRI as residential status, once he/she is back, you can update the residential status with AMCs.

      • Dear Sreekanth,

        Thank you for throwing light in to MIPs and STPs; I really likd the idea.

        Switching from Debt / MIP oriented funds will consider as redumptions know?, if so, we may need to pay exit load? - For each STP untill 1year completed?

        FD: was planning to park some portion in FD just for a pure debt allocation, but considering MIP, I may opt that STP idea.

        Also one doubt, can we initiate STPs from one AMC to another?

        I'm planning to opt for ICICI pru MIP, and STPs to ICICI balanced and HDFC children gift fund., or may be a small llocations via STP to ICICI focused blue chip and value discovery - may be 10-20% of total amt.

        Thanks,
        Noble

        • Dear Noble,
          Yes, exit load and tax implications will be there.
          Read my articles - Top MIP funds & MF taxation rules.
          We can't set up STP across AMCs. It should be within an AMC's available schemes only.

    • Dear Noble,
      Instead of investing the lump sum amount, suggest you to book Systematic Transfer Plans (STPs) in Debt / MIP oriented funds and you can switch every month certain amount to equity oriented schemes.
      For example - Book STP for say Rs 1 Lakh in ICICI Pru MIP plan and transfer Rs 25k for next 4 months to ICICI Pru Focused Bluechip fund / ICICI Balanced Fund.
      Go ahead with balanced fund. Why do you want to invest in FD? Any particular reason?
      PAN is mandatory and also you need to get KYC done.

• Hello SreeKanth
  Very informative post. I have started with monthly SIP of Rs25000 for term of 3 years from Apr2015. Here is my split, pl review and let me know whether it is fine are do I need to do any changes?
  1.Birla Sun Life Pure Value Fund-Growth --> Rs5,000
  2.Franklin India High Growth Companies Fund GROWTH --> Rs5,000
  3.ICICI Pru Focused Bluechip Equity Fund Reg Plan Growth --> Rs5,000
  4.RELIANCE SMALL CAP FUND - GROWTH --> Rs5,000
  5.RELIGARE INVESCO MID N SMALL CAP Fund -Growth --> Rs5,000

  I also have a lumpsum of Rs 400000 that needs to be invested .Ok to have a lock-in period of 5-7 years. Pl suggest options

  • Dear Nagmouli,
    Do you need money after 3 years? or you can stay invested for more time? Any specific financial goal that you have??

    • Hello Srikanth
      Current financial goal is having funds @the end of 4yrs & 6yrs to support my daughter 's education as she is going to 6th grade now

      • Dear Nagmouli,
        Goal Target year 4 years from now - Invest in a balanced fund for next 2.5 years and then switch the accumulated fund to a Debt fund or MIP fund. (Example - HDFC Balanced & Birla Sunlife MIP II Wealth 25 plan)
        6 years Target - Invest in a balanced fund for 4.5 years and move to MIP fund.
        Read my article - Top MIP funds.

• Hi,

  I am 31 years old want to invest 10000 in SIP. My planning are as follows:

  1. ICICI PRUDENTIAL FOCUSED BLUECHIP EQUITY FUND – REGULAR PLAN : 3000 for 5 years

  2. HDFC BALLANCED FUND : 3000 for 5 years

  3. HDFC MID CAP OPPORTUNITIES FUND : 3000 for 10 years

  Kindly suggest is it good planning or do I need to change .Thank you.

  • Dear Nilesh,
    Good selection & planning..go ahead and stay invested.

• Hi,
  I am new to SIP.I want to start my investment with Rs 1000 per month.Time may be 3-5yrs
  Please let me know best SIP plans also should i opt for ELSS thru SIP or normal open ended SIP.

  • Dear Poonam,
    If your investment horizon is < 5 years, you may consider below funds; HDFC Balanced fund (suggest you to stay invested for atleast 5 years) Birla Sunlife MIP II wealth 25 plan.

• Hi Srikanth,

  Thank you for such an informative blog. I am new to Mutual Funds and plan to invest Rs. 8000 as sip for the mutual funds. I m 31 and plan to invest in the horizon of 7-10 yrs. I have shortlisted few of the funds :

  HDFC Balance Fund (G): Rs.3000
  Canara Robeco emerging equities (G) : Rs. 3000
  Axis Long term Equity Fund (G) : Rs. 2000

  Please suggest

  Thanks

  • Dear Anurag,
    If I am in your place, will opt for ICICI Pru Focused bluechip or UTI Equity instead of Canara fund.

• Hi sreekanth,
  I have started 3 SIPs each of 1000 Rs in axis long term equity fund , ICICI prudential focused fund and ICICI prudential balanced fund... I heard that ICICI and AXIS are in the race of acquiring UTI mf ... Is that correct?
  I want ur valuable views about these three and want u to throw some light on their performances...
  Waiting for ur reply...

• I am new to this mutual funds.My monthly income is 34,000 and savings around 20,000. Pls suggest me good mutual funds to invest for 1-2 years. I shall invest around 15,000.

  • Dear Geetha,
    Do you need money after 2 years?

• I am new to MF. I want to know the whole procedure for investing money in ELSS. MF utility is a good option?

  • Dear Zuber,
    Kindly read my article on "MF Utility online MF platform".

• hi,
  thanks a lot for valuable reply............. i go for it as per your reply. as per your post top balance fund or see the almost answers of quries by you.. i selected HDFC BALANCE Direct plan for my investment but my friend say to invest in ICICI BALANCE ADVANTAGE fund........they say that its less volatile....... so pls suggest which is better HDFC BALANCE or ICICI BALANCE ADVANTAGE..............

  • Dear Prem,
    Both are good ones. HDFC balanced fund was launched in 2000 and icici fund in 2006. I am always comfortable choosing an old fund, as we get to a chance to analyze its performances over longer periods.

• Dear Sir

  I have two question in my mind regarding MF

  1. Instead of SIP say for example 5000rs per month, if i invest lumpsum 60,000rs in any MF will it bring less return?

  2. For selecting out of plenty MFs in market, what is the role of amount of Asset any MF is controlling? What i mean lets say two MF one is controlling 1000cr and another is 3000cr, now will the MF controlling higher amount of Asset will be the correct MF to choose?

  Pls.throw light on these queries. Thanks in advance

  Shunny Nigam
  Delhi

  • Dear Shunny,
    1 - Returns from SIPs and lumpsum can vary depending on the market conditions. If you invest lump sum and market gets into bull run say for the next few years, returns can be abnormal.
    2 - If you are a long term investor do not worry too much about the AUM size (Assets Under Management).