We have more than 11,000 Mutual Fund Schemes that are currently available in the market (Equity & Debt Schemes as on Sep, 2016). It is a highly challenging task for any advisor / investor to select best mutual fund schemes out of these thousands of schemes.
There is no doubt that Mutual Funds are one of the best investment options for long term wealth creation. However, if you pick wrong MF schemes that do not match your investment objective(s) and time-frame then it could spell disaster for you.
Investing in right mutual fund schemes which have been performing consistently well and monitoring your MF portfolio performance is a very important task.
Equity Mutual Funds are risk oriented products. You can consider investing in the below top performing mutual funds through SIPs (or lump sum) only if your time horizon is atleast 5 or more years.
I had published an article on ‘Best Equity mutual Fund schemes 2016’ in December, 2015. Below is the top 15 mutual funds (category wise) list as per my old article.
- Large-cap fund category
- Birla Sunlife Frontline Equity Fund
- ICICI Pru Focused Blue-chip Equity Fund
- UTI Equity Fund
- Diversified or Multi-cap category
- Franklin India Prima plus
- ICICI Prudential Value Discovery Fund
- Mirae Asset India Opportunities Fund
- Small & Mid-cap fund category
- UTI Midcap
- HDFC Midcap
- Franklin India Smaller Companies Fund
- Hybrid – Equity oriented category
- HDFC Balanced
- TATA Balanced Fund
- ICICI Prudential Balanced Fund – Regular Plan
- ELSS / Tax saving category
- Franklin India Tax shield
- Axis Long Term Equity Fund
- Birla Sunlife Tax plan
Below are some of the top performing best mutual fund schemes (Equity oriented) that you can consider for investing in 2017 and beyond. In this review, I have listed mid-cap and small-cap funds as separate categories.
Best Mutual Fund Schemes for 2017
(Click on the above image to open it in a new browser window)
- Large Cap Funds 2017 : I have retained Birla Frontline Equity & ICICI Prudential Focused Bluechip funds but replaced UTI Equity fund with SBI Blue chip fund. If you have invested in UTI Equity fund, you may hold on to the existing units and consider investing future SIPs/additional investments in other suggested Large cap funds.
- Multi cap Equity Funds 2017 : I have replaced Mirae Asset Opportunities Fund with L&T Value Fund and retained the other two diversified equity funds. If you have invested in Mirae fund you may continue with your existing and future investments.
- Mid-Cap Funds 2017 : I have retained both the Mid-cap funds that were listed in my last review (HDFC Mid-cap & UTI Mid-cap). I have added one more fund to the mid-cap fund category list ie Franklin India Prima Fund.
- Small Cap Funds 2017 : Besides Franklin Smaller Companies fund, I have added DSP Micro-cap fund and SBI Small & Mid-cap fund to the current list of best small cap funds.
- ELSS Tax saving funds 2017 : I am considering the same list of ELSS funds this year too.
- Equity oriented Balanced Funds 2017 : I have added SBI balanced fund to the list.
Let us now look at some more details of the funds listed under each of the fund categories.
Top 3 Best Large Cap Equity Mutual Funds
- There are around 150 large-cap equity funds. The average return from this category is around 12% for the last 5 years.
- Birla Frontline Equity fund has been one of the best and most consistent performer among the large cap funds. The Assets under Management (AUM) of this fund are around Rs 13,800 cr. The fund generally invests around 80 to 90% of its corpus in Large cap stocks and the remaining 10 to 20% in mid-cap stocks. It has managed to contain declines very well during bear phases (in 2008 & 2011).
- SBI Bluechip fund has been performing really well for the last few years. It has a ‘low’ risk grade and ‘high’ return grade.
- ICICI Focused bluechip fund has been a consistent performer for the last 5 to 6 years. The fund usually allocates 90 per cent plus to large-cap stocks and 5-10 per cent to mid caps.
- Franklin Bluechip fund, Birla top 100 fund & Quantum Long-term equity fund are the other large cap funds to watch out for.
Best Diversified / Multi-cap / Flexi-cap Equity Funds
- Multi-cap funds are also referred to as flexi-cap or Diversified Equity funds. Currently there are around 260 equity diversified equity schemes.
- Some mutual fund research portals list Franklin Prima plus fund under large-cap fund due to the fact that around 70% of its corpus is invested in Large cap stocks and the remaining balance in mid/small cap stocks. So, if you would like to pick a diversified equity fund with high large-cap exposure then Franklin Prima plus fund can be your choice.
- Currently, the portfolio allocation of ICICI Pru Value Discovery fund is also similar to Franklin Prima plus fund. Otherwise, this fund generally invests around 30 to 40% of its corpus in mid-cap stocks. It typically follows contrarian style of investing.
- L&T Value fund, relatively a new fund under multi-cap category, has been performing well in the last few years. This fund has a very good allocation across large, mid & small cap stocks (40:35:25). So, if you would like to make an aggressive investment in a diversified fund, LT Value fund can be your best bet.
- Franklin India High Growth Companies fund & Birla Equity fund are the other multi-cap funds to watch out for.
Best Mid-cap Equity Fund Schemes
- There are around 140 Small & Mid-cap equity fund schemes. The average returns from this category is around 25% over the last 5 year period.
- HDFC Mid-cap fund currently invests around 56% of its corpus in mid-sized companies. In 2008, 2011 and 2013, this mid-cap contained losses which are far lower than its benchmark (Nifty Free Float Midcap 100). If you are looking for a mid-cap fund which can withstand the choppy rides during bear phases then HDFC mid-cap fund can be your apt choice.
- Franklin Prima Fund has invested around 68% of its corpus in Mid-cap stocks and around 5% in Small cap stocks. It is one of the oldest mid-cap funds. It has beaten its benchmark (Nifty 500) in the last six years by big margins.
- UTI mid-cap is ranked consistently high for 5 year and 10 year period. Though the fund manager has been changed, its performance remained almost the same. The fund’s portfolio mix features a 55 to 60% mid-cap exposure and a 15 to 20% small-cap weight.
- The other notable mid-cap funds are Mirae Asset Emerging blue-chip fund and Principal Emerging Bluechip fund.
Top 3 Best Small cap Mutual Funds
- Franklin Smaller Companies fund invests in stocks with a market cap below that of the 100th stock in the CNX 500 index. Last one-year returns haven’t been top of the charts, but the three and five year records more than make up for this. As the fund’s investment style is more conservative, it is a good choice for investors who wants to invest in small cap fund with a less bumpy ride. Currently, the fund has allocated 43% of its corpus to Small Cap stocks and 47% to mid-cap stocks.
- DSP Micro cap fund has a very high allocation to small cap stocks which is currently around 65% of its corpus. The fund has been overweight on small cap stocks relative to its peers and underweight on both mid- and large-cap holdings. It follows buy & hold investment strategy. Hence, it has a very low Portfolio Turnover ratio which is at 13% (Turnover ratio is a measure of how a fund’s portfolio changes in a year.)
- Around 76% of SBI Small & Mid-cap fund’s corpus has been invested in small cap stocks. It has ‘below average’ risk grade and ‘above average’ return grade. Kindly note that the fresh investments have been ‘ Suspended Temporarily’ by the fund.
- Reliance Small cap fund is another good small-cap fund that is worth tracking, but its Standard deviation is very high.
Top performing Tax-saving Mutual Fund Schemes (ELSS)
- There are more than 100 tax saving ELSS mutual fund schemes in the market. This category’s average returns are around 12% for the last 5 years.
- Franklin Taxshield is an ELSS fund but you can consider this as a typical Large-cap fund, as around 80% of its corpus has been invested in large cap stocks. This fund generally doesn’t take cash calls and remains fully invested through market cycles. If you are a risk averse investor and wants to take tax benefit, this is a good bet.
- Axis LTE fund can be treated as flexi-cap fund with tax benefits. Its risk grade is ‘low’ and return grade is ‘high’.
- Birla Tax plan, Birla Tax relief 96 fund & DSP Tax Saver funds have also been consistently performing well.
Best Balanced/Hybrid Equity Funds
For a detailed review on Balanced funds, kindly read : Best Equity oriented Balanced funds.
My Mutual Fund Portfolio
I have remained invested in the same set of funds in this calendar year too. However, I have added Franklin Smaller Companies fund to my long-term portfolio.
In the next calendar year i.e., 2017-18, I am planning to discontinue my future investments in TATA balanced fund and continue my SIPs/additional lump sum investments in other funds. (Kindly note that I have disclosed my portfolio only for information purposes and these are not recommendations. Kindly pick MF Schemes as per your financial goals.)
My observations & general suggestions
For the last two years, I have been receiving thousands of comments/queries on mutual fund schemes. I get a chance to learn new things when answering these queries. Let me share my observations and suggestions with you all;
- Identify your Goals : Majority of us identify the products first and then try to shortlist best investment avenues. An investor has to first identify his/her financial goals and then try to short-list best available options. This is applicable for mutual fund investments also.
- Invest Goal-wise & not as per your age-wise: Even if you are a Senior citizen, you can invest in Equity funds if they are suitable to your investment objectives. Equity funds are for any type of investors.
- Diversify across Fund categories & Fund houses : I often observe that investors invest in multiple funds of same Fund house. Suggest you to not only invest in funds offered by different fund houses but also try to pick funds from different fund categories. (Kindly read: ‘What are Large, Mid, Small,Multi-cap funds?‘)
- Ignore Short-term volatility : It is understandable that an investor (especially new investors) may panic if he/she sees negative returns on his MF portfolio. If you have invested in Equity oriented mutual funds for medium to long-term, kindly stick to your investment objectives. It is advisable to ignore short-term volatility (if any). But do track the performances of your funds & portfolio once in a year.
- Consistency is the key parameter : A ‘good mutual fund scheme’ is the one that consistently manages to outperform its category returns and also it’s Benchmark’s. It is prudent to be with the consistent performers for long-term goals instead of churning your portfolio based on Star ratings or recent performances of the funds.
- SIP & Additional investments : Is SIP a sure-fire way of creating long-term wealth? Systematic Investment Plan (SIP) inculcates financial discipline. However, it is not a fair comparison to equate SIPs with investing in a lump sum. Both have their own pros and cons. It is better to have SIPs in place and at the same time, you can make additional investments (lump sum) when you believe that markets are down.
- Realistic Expectations : If you analyze the returns generated by the above list of funds for the last 10 years, the maximum is 16% and the minimum return is 10%. So, let’s have realistic expectations from equity funds. May be, a 12% rate of return sounds very good 🙂
- Regular & Direct plans : I do get lot of queries on what is the difference between ‘Regular plan’ and ‘Direct plan’. Kindly read this article for a detailed explanation on this topic : What are Direct Plans of Mutual Fund Schemes?.
Kindly note that the above list of best mutual fund schemes is not an exhaustive one. Mutual funds are not guaranteed, their values/returns change frequently and past performance may not be repeated.
Continue reading :
- How to select best Mutual Fund Scheme?
- Mutual Fund investments are subject to market risks : My opinion!
(References : valuereasearchonline, moneycontrol, freefincal & morningstar portals)
( Image courtesy of Stuart Miles at FreeDigitalPhotos.net) (Post published on 16-December-2016)
Nice blog.
Once a newcomer decides to invest in mutual fund schemes an obvious question comes to mind. Which scheme to invest in?
With a plethora of options to choose from you should make your decision based on a couple of factors:
• Financial goals: Based on your requirements and the financial goals you have you should choose the appropriate funds. You should also keep in mind the amount of risk you can undertake while choosing your mutual fund schemes.
• Historical Patterns: Even though mutual funds may behave differently in a matter of a few months, a good measure to judge mutual funds is their historic patterns. See how it has behaved over the years. The cycles of growth and fall it has gone through the years and its recovery patterns.
• Parameters: Monitoring a fund’s Hurst exponent will give you an idea of the consistency of the fund. If the H component is high then the fund will experience low volatility and vice versa.
There are also downside risk and outperformance parameters that you can monitor from daily updates.
That being said some of the best mutual fund schemes to invest in are:
1. ICICI Prudential Equity and Debt Fund
2. Axis Bluechip Fund
3. ICICI Prudential Bluechip Fund
4. L&T Midcap Fund
5. Mirae Asset Hybrid Equity Fund
Dear Sushmita ..Thank yo for sharing your views/info!
Hi,
I like your articles and your analysis.I had started SIP is SBI Bluechip and Kotak Select focus fund one year back. now after some gaining a little knowledge like downside protection, rolling returns etc and reading articles a couple of reliable sites like yours, I want to continue long term SIP for 15 years with low to moderate risk in terms of equity. I am investing around 50:50 in debt and equity Debt is my PF and PPF for 15 years.
After re-categorization of fund Kotak select and Franklin Prima plus both are multicap. I want to make a core portfolio for equity where I will need to analyse this once in an year.
SBI bluechip 40%
Franklin Prima Plus 40%
HDFC Mid cap opportunity 20%
or
SBI Bluechip 40%
Kotak Select Focus 40%
Franklin Prima (mid cap) 20%
I am confused choosing between Kotak select and Franklin Prima plus and another confusion between Franklin Prima and HDFC Mid cap. also in case I need to choose one fund from Franklin what will be your recommendation.
Dear prakash,
Since you have already invested in SBI bluechip & Kotak selectfocus, suggest you to kindly continue with them, both are decent choices.
You may add one mid-cap fund to your portfolio as mentioned by you.
Very tough call to pick one fund out of HDFC mid-cap or Franklin Prima fund.
Given a choice, I would pick HDFC Fund.
Related article : How to select the right and best Mutual Fund Scheme based on the Measures of Volatility?
Thanks Sreekanth. The main reason of my confusion was because of portfolio overlap between SBI bluechip and Kotak select focus. in last few months there were huge overlap. my investment is not much in any of them, so before making final decision if we should continue either or both of funds I thought to ask for your opinion.
Also High AUM of HDFC midcap should not be worrying as of now? what is your opinion here?
Dear prakash,
Owing to change of Investment objective, fund type and strategy, we may see a change in their portfolios and overlap.
In case, you have not invested heavily then you may start investing in either of them and pick Prima plus (check overlap) and then a mid-cap fund.
I do not worry much about high or low AUMs.
Thanks Sreekanth.
Dear Sreekanth,
I’m 35 years of age, Marriage with 2 boys(twins 3yrs old).
We have no current liabilities. 10 Lacs in FD(shall move it to equity as they mature). I have Term plan for 1.4 cr + 50 lacs Parmenant disability cover. Medical is covered from our office(14 Lac for me & 6 lacs for my wife). However looking for a family cover in addition, appreciate if can also suggest on this front.
Below is my and my wife’s(also working) portfolio, appreciate your views on we achieving the desired goals.
Below are monthly additional investments except Emergency Fund which was a lump sum investment.
Emergency Fund Allocation % Allotted
ICICI Prudential Equity Arbitrage Fund -Direct 200,000
ICICI Prudential Liquid Plan 200,000
400,000 NA
Short Term(3+ yrs) Allocation
Franklin India Low Duration Fund 1,000
SBI Magnum MIP 2,000
3,000 7.06%
Medium Term(10+ yrs) Boys Graduation(Target 10-12 Lacs) Allocation
Franklin India Smaller Companies fund 5,000
HDFC Balance Fund 4,000
Birla Sunlife MIP II WEALTH 25 Plan 1,000
UTI MID CAP Fund 2,000
12,000 28.24%
Medium Term(20+ yrs) Boys Post Graduation + Marriage Allocation
HDFC Mid-Cap Opportunities Fund 5,000
ICICI Pru Value Discovery fund 1,000
Franklin India High Growth Companies 5,000
L&T India Value Fund 4,000
15,000 35.29%
Long Term(30+ Yrs) Retirement Allocation
DSP BlackRock Tax Saver Fund 3,000
SBI Blue chip 3,000
Axis Long Term Equity Fund 1,000
Tata India Tax Savings Fund 1,000
Birla Sun Life Tax Saver 96 1,000
Birla SL Frontline Equity Fund 3,500
12,500 29.41%
Medium Term(20+ yrs) Boys Post Graduation + Marriage- Required amt will be around 1cr as per todays cost.
Long Term(30+ Yrs) Retirement- Required amt will be around 1cr as per todays cost.
Sorry missed this point.
Regards,
Sam
Dear Sam,
1 – Medical cover.
Kindly go through below articles:
Best Family floater plans
Important factors to keep in mind when buying a health cover
Super top up health insurance plans
Best portals to compare health insurance plans
2 – You may keep an eye on UTI mid-cap fund’s performance, as it is not upto the mark.
You are following goal-wise portfolio approach. That’s fine!
The listed funds are all good ones.
Suggest you to kindly go through below articles;
Kid’s education goal planning calculator
Retirement goal planning
What is 200 DMA?
How to pick right mutual fund schemes?
MF portfolio overlap analysis tools
Dear Srikanth,Although this article is seven months old,but many investors look forward to new Ideas for investment in MFs in new year 2018.looking forward to a fresh article from you for investment in 2018.
Dear Jawahar ji ..Sure, will publish the article at the earliest.
As per the latest SEBI’s circular on MF re-categorization, the fund houses have to re-organize their scheme portfolio. Hence, awaiting for the latest update. If this is going to take some more time, will surely go ahead and publish my article by this month end or in Jan 2018.
Hi Sreekanth,
I’m 38years and am repaying a Home loan of 27lakhs with 27k EMI.
Apart from that I have 2 Life Term Insurance plans of 50lakhs each from AegonLife & Aviva .
I want to start SIP for my daughter’s Studies & marriage after 10-15 years.
And also need to save for my retirement.
I’ve ruined a lot of lakhs in Share Markets Futures & options, in an attempt to get Rich overnight.
So Please suggest me where to start from, for my future goals.
I can spare 10k-15k per month after my home needs & EMI.
I’m quite new to your Blog & Mutual funds also.
Please suggest accordingly.
Regards
RK
Dear Nagraj,
Suggest you to kindly go through below articles, can be useful to you, and you may revert to me with more queries (if any) ;
Kid’s education goal planning
Retirement goal planning
How to create a solid investment plan
List of important articles on financial planning
Hi Sreekanth
I have to setup sip for Rs 10000 for my daughter higher education for 10 years, I am not sure which category fund I choose and in which proportion.
Please help me to achieve my goal.
Regards
Sameer
Dear Sameer,
Kindly go through this article :
Kid’s education goal planning
Hi Srikanth
I have taken a home loan this year with monthly emi of Rs28500 for next 20 years. Now I have 10 lacs, instead of paying principal now. I am planning to invest this some in MF for 6 to 7 years to repay loan completely. My goal is to use this amount effectively to repay remaining loan in one go. Please suggest me how to achieve this goal and which MF should be chose and in what proportion.
REgards
Sameer
Dear Sameer,
Kindly go through this article : Pay-off home loan or invest in MF?
If your time-frame is around 7 years, you may consider equity oriented balanced funds, invest them for next 5 years and then switch to safer bet 1 or 2 years before you plan to settle the home loan.
Kindly read :
Best Balanced funds
How to pick right mutual fund schemes?
Hi Sreekanth Sir,
First of all thank you so much for sharing such a valuable investment information and suggestions as investment in mutual funds is really challenging
I just came across your blog while searching for best mutual funds.
I am yet to read your blog completely.
I am 30 year old with no investment plan yet and married too and i am the only single earning person in family .
I am a salaried person and salary is 35k per month
I am planning to invest for long term though i read about mutual funds, stocks and shares but still confused
Please give me sir guidance over this
Thanks in advance
Dear Manoj,
Suggest you to kindly go through below article, you may get some idea about financial planning, you may revert to me with more queries ;
List of important articles on FP
Thank you Sreekanth Ji
Hi Sreekanth,
Thank you for sharing knowledge with us. I have been following your blogs quite some time and must say its amazing.
Request you please review my portfolio– Long term (12+ years) , Children education and wealth creation for retirement. Below fund are Direct and Growth type SIP
1. Kotak select focus fund – 1500
2. Motilal oswal multicap 35 – 1500
3.HDFC midcap 1500
4. Franklin I smaller companies – 1500
5. Mirae emerging fund – 1500
6. Reliance small cap – 1500
7. DSP blackrock tax saver – 1500
8. Birla sunlife tax saver 96 – 1500
9. HDFC Bal fund – 1500
Dear Murari,
All the listed funds are good ones, but investing in too many funds may not be that beneficial.
May be 2 to 4 funds is more than enough, can be one diversified equity fund + one mid-cap fund + one balanced fund.
Suggested readings :
Retirement goal planning
Kid’s education goal planning calculator
How to select right mutual funds Schemes?
MF portfolio overlap analysis tools
Hi Sreekanth , I am regular follower & reader of your blog and thanks for keeping posted on recent financial changes and helping me to take decisions in new investments.
Pls review my portfolio & advise if anything needs correction.
I am 27 year old (unmarried) and as of now I don’t any liabilities on me .
My goal is tax saving + wealth accumulation only.
My SIPs are perpetual and I want to invest for more than 25 years , adding to my past SIP’s now I want to invest more ,can you please suggest me few funds (Large or Mid or Small caps).
As of Now I am investing 6000/Month and want to add 5000/Month more.
Please suggest.
My portfolio is –
SBI Pharma Direct-G(1000/M) 14 Months Old
SBI Bluechip Direct-G(1000/M) 14 Months Old
Kotak Select Focus Direct-G(1000/M) 14 Months Old
DSPBR Tax Saver Direct-G(1500/M) 6 Months Old
Axis Long Term Equity Direct-G (1500/M) 6 Months Old
Dear Ankit,
Thank you for following my blog posts!
The above mentioned funds are decent ones. You may add one Mid-cap fund. Ex : HDFC Mid-cap opp fund (or) Mirae Emerging bluechip.
Kindly read :
How to pick right mutual fund schemes?
MF Portfolio overlap analysis tools
Hi Sreekanth ,Thanks for the Quick response and recommending good funds!
I am still finalizing the sips in which I want to make investment .
1.Can you please clarify the significance/effect of expense ratio in Direct SIP , how can I calculate my returns on the running/past SIP’s and Should I concern about the higher expense ratio (above 2.0) for investing in future SIP’s .
2. Also if my SIP is performing well , can I increase the SIP installment value (from 1000 to 5000) in the same one or I’ll have to book a new SIP in the same fund.
Thanks
Dear Ankit,
1 – Most of the platforms do provide the performance report (returns calculations). In case, it is not available, suggest you to add a dummy portfolio with the funds that you have inveted in, on portals like Moneycontrol / Economic times and track their performances.
For manual calculation, kindly read :
What is XIRR excel formula?
Five formulas to calculate return on investments
Kindly do not worry too much about expense ratio, as most of the funds have it in the same range. In case, you see a drastic difference out of the say two shortlisted funds, you may pick the one which has lower expense ratio. Kindly note that expense ratio can vary from time-to-time.
2 – You may make additional investment/SIP in the same fund with the same folio number.
Dear Sreekanth,
I would like to know why it is not advisable to invest in many funds ( more than 5 0r 6 ) when the portfolio overlap ratio is less than 10% among each.
My time-frame is 10 yrs and want to achieve high corpus by investing in multiple funds across different sectors.
Goal is for New house construction, Child Education/Marriage etc.
Dear Angari,
Kindly note that most of the funds do invest in different sectors.
Reviewing multiple funds can be a difficult task and more the funds in ones portfolio there can be a higher chance of frequent churning of portfolio.
Also, may be it is tough to find multiple funds with a portfolio overlap of less than say 10%, as there are limited number of available stocks.
Suggested readings :
Retirement planning calculator
Kid’s education goal planning
Hi Sreekanth ,
I have started following your blog a month back . Must say its amazing !! Thanks for sharing the knowledge .
I am new to Mutual Funds , And after studies planning to invest in the below :
1. SBI Blue Chip : Large Cap : 2000 pm
2. Axis LTE : 2000pm : Tax Saving
3. DSP Micro Cap Fund : 1000 pm
Please let me know if any changes are required .
Dear Pooja,
Thanks for your appreciation!
May I know your investment objectives and time-frame??
Is Axis LTE for your tax saving purposes?
Kindly note that fresh investments to DSP Micro fund have been temporarily suspended.
Related articles:
How to create a solid investment plan?
How to pick right mutual fund schemes?
MF Portfolio overlap analysis tools
Hi ,
The main objective is to get good returns and a bit of tax saving under 80c (I also have NSCs).
Time frame is 5 years . If DSP Micro Fund is suspended May I know what is the other option for it.
And also Lemme know if below portfolio looks good :
1. SBI Blue Chip : Large Cap : 2000 pm
2. Axis LTE : 2000pm : Tax Saving
3. *** Replacement for DSP
Dear Pooja,
The first two funds are fine. But do note that the units allotted under each SIP of an ELSS fund (Axis LTE) get locked for 3 years, in case your time-frame is 5 years, you need to plan your investments accordingly.
Instead of a small cap fund, you may consider an equity oriented balanced fund like HDFC balanced fund (for a 5 year time-frame).
Hi ,
Thanks for your response .
For ELSS Fund , If locking period is 3 years , it can be withdrawn anytime thereafter ; Right ?
Let me know for ELSS Funds what locking period you suggest !
Thanks for your suggestion , would include HDFC Balanced Fund in my portfolio .
Also are small cap funds not good for 5 years ?
Dear Pooja,
Yes, after 3 year period, the units can be withdrawn.
But kindly note that the units allotted say in Jan 2017, will come out of lock-in period after Jan 2020 and same is the case with respective SIPs.
3 years lockin period is a mandatory one for ELSS tax saving funds like Axis LTE.
For regular MFs there is no lock-in period as such.
It is not good or bad, but investing in small cap funds for shorter term can be a risky bet.
Hi Sir ,
Thank a lot , I proceeded with the investments as per your suggestions 🙂
I am 27 years and want to have Insurance where I need to have returns in between as well.
I can invest upto 36k per annum for Insurance .
Let me know which ones can I go ahead with !
Thanks
Dear Pooja,
Kindly do not mix insurance with investment.
If you are an earning member of your family and have dependents and/or have financial liabilities, you may buy a basic term life insurance cover.
Do buy a stand-alone personal accident cover and a health insurance policy.
Suggested readings :
Traditional life insurance plans – a terrible investment option?
Term insurance plans Vs endowment insurance plans
If life is unpredictable, insurance cant be optional!
Best Term insurance plans
Best Personal accident insurance plans
Hi Sreekanth,
Nilesh here once again. My current Age is – 32 .
I have below current MF investment.
1 Birla Sun Life Equity Fund -Dividend Payout – 5 Years – 5000 (Monthly) from Dec 2016
2 HDFC PRUDENCE FUND – MONTHLY DIVIDEND PAYOUT – 5 Years – 3000 (Monthly) from Dec 2016
3 Franklin India PRIMA FUND GROWTH – 25 Years – 5000 (Monthly) from Dec 2016 – MID CAP
Can I cancel my existing both Dividend Fund and instead of this I will add new MFs along with existing Franklin India Prima Fund.
So my new MF portfolio will be as follows
1) Birla Sunlife Frontline Equity Fund -(D) Growth – 20 Yrs – 5000 Rs
2) Franklin India Smaller Companies (Direct Growth) – 20 Yrs – 3000 Rs
3) Kotak select focus Fund Direct Growth – 20 Yrs – 3000 Rs
4) HDFC Balanced Fund Direct Growth – 20 Yrs – 4000 Rs
5) Franklin India Prima FUND GROWTH – 20 Years – 5000 Rs
Considering the above new portfolio Can I achieve my goal 2 Crore during retirement (At the age of 55-60 )
Kindly suggest your comments .
Thanks.
Dear Nilesh,
You may do so. You may switch the funds from HDFC Prudence to HDFC balanced fund (growth).
Birla Equity fund is a good one, but you may switch to Growth option.
You may kindly use the calculators available in the below articles regarding corpus accumulation calculation ;
Retirement planning calculator
Kid’s education goal planning calculator
Hello Shreekanth,
I am a DIY investor and have chosen the following fund for sip:
1. Absl frontline equity fund -dir growth -5k
2. Kotak select focus -dir growth – 5k
3. Reliance small cap -dir growth – 4k
4. Uti opportunities – -dir growth -2k
5. Kotak emerging equities – -dir growth – 2k
6. Hdfc mid cap opp – -dir growth – 2k
My question is that is my portfolio diversified or over diversified.?
My investment horizon is 13 years and I my current age is 35 and I am investing for my early retirement by age 48.
Also according to Value research my investment is like – 38.83 % in giant cap, 15.45 % in large cap, 28.16 % in mid cap, 16.24 % in small cap, 0.13 % in tiny cap, 1.19 % is unclassified.
Can u please put forward your valuable input regarding my investments.
Thx n regds
Sonit
Dear Sonit,
You may ignore UTI opp fund. This is a large-cap oriented fund (as of now based on the fund’s portfolio), you have Birla frontline, which is a decent fund.
You may ignore Kotak Emerging if picking HDFC Mid-cap opp fund.
I prefer investing in Franklin Smaller cos fund to Reliance small cap fund.
Related articles ;
How to pick right mutual fund schemes?
MF portfolio overlap analysis tools
Dear Sir,
I am going to get 12 lacs in Jan 2018.I am doing SIPs.I want to invest 10 lacs in Mutual Fund from where I can do 10k per month SWP for 2 years and I want to do STPs also.I want to Invest this amount in Franklin,HDGC,SBI and Birla SL Mutual Funds 2.5lacs each.
Pl suggest.Thanks
Dear Kedar,
For SWP of 2 year time-frame, you may consider a Short term debt fund like Franklin low duration fund.
Do note that SWPs are subject to taxes (if any). Kindly read : MF taxation rules
May I know your investment objective and time-frame for lump sum investment? Any specific funds in your mind??
Related article : How to pick right mutual fund schemes?
Thanks Sreekanth. My goal is for 5 years wealth creation. My plan-25% SBI Savings Fund-Swp and STP to SBI Mid cap, Blue chip, Multicap, Balanced Fund. 25%in Birla SL-swp and stp to Front line equity.25% to Franklin Ultrashort Bond Fund-Swp and stp to Smaller companies and High growth and Prima Plus. Last 25%In HDFC MADCAP OPPORTUNITIES FUND AND BALANCED FUND.10%SWP and STP at regular 15days span
Dear Kedar,
Your investment strategy is fine.
But, investing in too many funds may not be really beneficial.
In case, your investment time-frame is around 5 years, you may allocate lesser amount to mid/small funds. Can prefer largecap/balanced funds.
Kindly read :
MF portfolio overlap analysis tools
Hi Sreekanth,
Thanks for creating such nice informative Blogs about Mutual Funds.
MySelf Nilesh Patil – Age -32 Yrs and working as NRI. Dependents – Spouse and 2 Yr Daughter
I am investing in Mutual Funds since last 11 months and planning to invest around 10K (total) more fund for SIP Long term one for 20 Yrs and another for 25 Yrs from Dec 2017.
My goal is to achieve at least 2 Crore during retirement (At the age of 57-60) and should have 50 Lacs for my Daughter marriage and Education at her age around 21-27 Yrs.
* Mutual Fund investments-
1 Birla Sun Life Equity Fund -Dividend Payout – 5 Years – 5000 (Monthly) from Dec 2016
2 HDFC PRUDENCE FUND – MONTHLY DIVIDEND PAYOUT – 5 Years – 3000 (Monthly) from Dec 2016
3 Franklin India PRIMA FUND GROWTH – 25 Years – 5000 (Monthly) from Dec 2016 – MID CAP
Please suggest your comments
1) Please review my portfolio and suggest do I require to change in existing Mutual fund ?
2) Planning to invest in SIP for Long term MF (20 and 25 Yrs) . Kindly Suggest which Mutual Funds should I invest ?
3) Recently there was new Mutual Fund announced called Axis Multicap Fund on October 30, 2017 (An Open Ended Equity Fund) What is your opinion about this Fund and will it be good for SIP ?
Thanking You in advance..
Nilesh Patil
Dear Nilesh,
If you are planning for long-term goals, suggest you to opt for Growth option instead of Dividend payouts of MF schemes.
The listed three funds are decent ones.
You may kindly ignore Axis Funds NFO.
Suggested readings :
Retirement goal planning
Kid’s education goal planning
How to pick right mutual fund schemes?
Hi Sreeknath,
Thanks for your quick response. Because of your MF blogs I started my MF investment and future financial planning very easily to achieve my goals.
Could you please recommend which Mutual Fund should I invest with Growth option as SIP at Low Risk and High Grade ?
Appreciate for your big Thanks.
Dear Nilesh,
You may opt for Growth option in your existing schemes itself.
Hi Sreeknath,
Might you explain correctly, but I am not understand your guidelines.
Please elaborate in details about opt for growth Option and correct me If mentioned something wrong. Sorry to bother you again on same point.
Also I need your views on below mentioned MF.
1) The below mentioned Funds are good for Long term (around 15-25 yrs) with Low risk or Moderate risk profile
2) You can give your best opinion to select best MF out of below 4
SBI Blue Chip Fund – Direct Plan – Growth – 4000 Rs
Franklin India Smaller Companies (Direct Growth) – 2000 Rs
HDFC Balanced Fund Direct Growth(Equity based Balanced Fund) – 2000 Rs
L & T Value fund Direct Growth – 2000 Rs
Apologies for inconvenience.
Thank in Advance.
Dear Nilesh,
You have invested in Birla Equity (Dividend), HDFC Prudence (Dividend) & Franklin Prima (Growth).
As your time-frame is long-term, instead of Dividend option, it is advisable to opt for Growth option for the first two funds as well.
The listed four funds are good ones.
You have HDFC prudence fund in your portfolio, so you may ignore HDFC Balanced fund.
Kindly read : MF Portfolio overlap analysis tools
Hi Sreekanth,
Appreciate your effort.
Thanks for your valuable guidelines.
Hi Sreekanth,
My current Age is – 32 . ( Daughter Age – 2 yrs) . My goal to achieve around 2 Crore during retirement (At the age of 57-60) . In future I should have 50 Lacs for my Daughter marriage and Education at her age around 21-27 Yrs.
I have below current MF investment.
1 Birla Sun Life Equity Fund -Dividend Payout – 5 Years – 5000 (Monthly) from Dec 2016
2 HDFC PRUDENCE FUND – MONTHLY DIVIDEND PAYOUT – 5 Years – 3000 (Monthly) from Dec 2016
3 Franklin India PRIMA FUND GROWTH – 25 Years – 5000 (Monthly) from Dec 2016 – MID CAP
Now planning to invest in below mentioned MF. Kindly review below MF and suggest which MF should I select and move ahead for Long term investment considering my current portfolio MF
Aditya Birla Sun Life Frontline Equity Fund – Direct Growth – 4000
Kotak Select Focus Fund Direct Plan – Growth – 3000
SBI Blue Chip Fund – Direct Plan – Growth – 4000
Franklin India Smaller Companies (Direct Growth) – 2000 Rs
L & T Value fund Direct Growth – 2000 Rs
Franklin India Smaller Companies (Direct Growth) – 2000 Rs
Thanks in advance.
Dear Nilesh,
The shortlisted funds are good ones.
But you may pick either of the two large cap funds (Birla frontline or SBI bluechip) and kotak select focus or L&T value fund.
Investing in too many funds may not be really beneficial.
Related articles:
MF portfolio overlap analysis tools
Hi Sreekanth,
Thanks for sharing the regular blog and your information keep us motivating to invest in proper way.
I need your assistance to include sum fund or to add the amount in current SIP, as i want to increase my allocation, kindly see the below my current SIP allocation,
ICICI Pru focuse Blue chip – Direct G – 1k
ICICI Pru Value discovery – Direct G – 2K
Franklin India Smaller Comp – Direct G – 1K
Axis LTE – Direct G – 2K
Franklin Tax shield – for Wife – Direct G – 2k
now i want to increase 2 – 3 K per month in SIP, hence suggest that shall i start new SIP or add amount in above any one or two fund.
Kindly suggest. Consider time frame as maximum as 5-10 yrs.
Regards
Mihir
Dear Mihir,
ELSS funds can also be considered as Multi-cap funds, so you have three diversified funds (ICICI Value, Axis LTE & Franklin Tax shield).
You may check their portfolio overlap.
May it is advisable to add one Equity oriented balanced fund to your portfolio. For ex : HDFC Balanced fund.
Hi Sreekanth,
Thanks for your response.
Can i go with ICIC Pru advance balance fund or Franklin Balanced or DSP Black rock.
Please suggest your view on above balance fund.
Regards
Mihir
Dear Mihir..You may kindly go through my article on Balanced funds..
Hello Sreekanth ,
Good morning !
Seek your advice as I am rechurning my portfolio.
As per Sebi’s new norms regarding reclassification/merging of Mf’s should one wait till this process is over or go ahead irrespective.
Mf’s planned:
HDFC balanced fund
ICICI Pru focussed bluechip
Thanks & Regards,
Roy
Dear Roy,
Suggest you to go ahead with these schemes, as these are popular ones, I dont think the respective AMCs will close these, at the most they merge with other schemes or merge other schemes with these.
Thank you Sreekanth.Good day
Thanks & Regards,
Roy
Hi Sreekanth,
Hope you are doing well. Need your advice for modifying my portfolio.
I want to accumulate money with the aim of child education and marriage. Time horizon is 13 years.
For this goal, I have an existing monthly SIP of Rs 8000 in following funds. This was started 1 year before.
1. Franklin India High Growth Fund – 4000
2. Franklin India Prima Fund – 4000
I wish to increase the total monthly SIP amount from 8000 to 15000.
Could you please suggest on following
1. Should any one of the existing funds be replaced or I can continue with them.
2. Please suggest additional funds that should be added (would like to add 1 or max 2).
Thanks,
Amit
Dear Amit,
Both are good consistent performers and belong to diff fund categories.
You may add one Balanced fund like HDFC balanced fund to your portfolio.
Related articles :
How to pick right mutual fund schemes?
Kids’ education goal planning
What is 200 DMA?
Thank you, Sreekanth !
Hi Sreekanth,
What is your view on DSP BlackRock Opportunities Fund. The returns are good and this fund is running since year 2000, it has gone through all phases of the market.
Will it be a good choice if I have to pick a multicap/diversified fund.
Dear Amit,
You already have Franklin HGC Fund which is a multi-cap, its performance is better than DSP opp fund.
Suggested readings :
How to pick right mutual fund schemes?
MF Portfolio overlap analysis tools
Sir,
STCG tax is 15% on equity.
But someone say to me–
Trading (Interaday or very short term) & F&O gain is taxed as per ur tax slab.
It is true ?
Dear Pankaj,
STCG @ 15% is for delivery based investments. You buy some shares, take delivery and if sold within 12 months, you may make STCG.
Whereas, Intra-day trading is a Speculative income. F&O is categorized as a non-speculative income. Any gains from these activities have to be added to your other incomes like Salary, rental income,. bank interest income etc. and taxes have to paid at the applicable slab rate.
You may go through this detailed article on this topic..
Sir,
If I hold delivery 1-2 or 4-5 days only,
than it is delivery based investment & under STCG.
Dear Pankaj ..Yes, if you buy and take the delivery of shares on to your Demat account, and if you then sell them after a few days, any gains you make is categorized as STCG.
Related Article : Why one should avoid doing Short term Share trading..?
Hello Sreekanth,
I intend to make changes in my ongoing SIP portfolio towards both my daughters PG education and house renovation
This is specifically with regards to Tata Balanced fund -Direct Growth which i want to exit and re invest the same sip amount in other fund/funds.
Elder Daughter’s PG-10 yrs horizon-Current ongoing Sip’s:
Tata Balanced fund-5 k
Icici pru focussed bluechip fund-3k
Franklin india prima plus-4 k
Hdfc mid cap oppurtunities fund-4 k
Franklin india smaller companies fund-3k
Icici pru value discovery fund-2k
Want to exit Tata balanced fund and re invest the 5 k in HDFC balanced fund or divide the 5 k proportionately among the HDFC mid cap and ICICI pru value discovery.
Younger Daughter’s PG-15 yrs horizon-Current Ongoing sip’s:
Tata Balanced fund -6 k
Franklin India smaller companies fund -4 k
Franklin India taxshield-5 k
Want to exit Tata balanced fund and re invest the 6 k in HDFC balanced fund .
House renovation-8 yrs horizon-onging sip’s
Tata Balanced fund- 2 k
Icici pru value discovery fund-1 k
Exit tata balanced fund and the reinvest the 2k in ICICI pru value discovery.
Would appreciate your advice on the above mentioned changes
Thanks and regards,
Roy
Dear Roy,
Goal 1 – Ok.
Goal 2 – As the investment horizon is 15 years, may be allocate higher amount to Franklin funds and have a lesser allocation to HDFC Balanced fund.
Goal 3 – Have a balanced fund.
Thank you for your prompt response Sreekanth.Is the below revised allocation ok:
Goal 1:
HDFC Balanced fund-5 k
Icici pru focussed bluechip fund-3k
Franklin india prima plus-4 k
Hdfc mid cap oppurtunities fund-4 k
Franklin india smaller companies fund-3k
Icici pru value discovery fund-2k
Goal 2:
HDFC Balanced fund -2 k
Franklin India smaller companies fund -6 k
Franklin India taxshield-7 k
Goal 3
HDFC Balanced fund- 2 k
Icici pru value discovery fund-1 k
Thanks and regards,
Roy
Dear Roy..You may go ahead with your investment plan!
Thank you for your advice and guidance Sreekanth.
Wish you a ‘Happy and Safe Diwali’ .
Thanks & Regards,
Roy
Wish you all the same! Happy Diwali! Thank you!
Hello Sir,
I’m planning to start the SIP’s in the below funds.
SBI Blue Chip Fund – 10k
ICICI Pru Value Discovery Fund – 10k
DSP Black Rock Micro Cap Fund – 10k
I currently have a SIP of 10K – Axis Long Term Equity Fund for tax purposes.My goal is wealth creation.
Please advise if okay to proceed.Thanks.
Dear NT,
Kindly note that fresh investments into DSP micro cap fund are temporarily suspended.
As an alternative to this fund, you may consider Franklin Smaller cos fund.
May I know your investment time-frame?
Hello Sir,
My time frame is 3 years. I’m not sure now if I will continue working, hence the short time frame.I don’t want the money to remain idle hence looking for Investments with good returns.
Dear NT..If you are not sure about the time-frame and minimum horizon around 3 years, you may stick to large-cap and balanced funds.
Ex : SBI Bluechip fund, HDFC Balanced fund etc.,
You may avoid investing in Mid/small cap funds.
Also, do note that the units allotted under each SIP of ELSS (Tax saving fund like Axis LTE) are locked for 3 years.
Hello sir,
Could you please help in achieving my goal. I have home loan of 16 Lacs. My target is to complete my loan in 3 years. I can invest 30k per month in MF. I have some amount in FD for emergency need.
Could you please suggest me good fund which will help in achieving 16 lacs by end of year 2020.
Also, curious to know whether SIP would be good or investing in bulk (in selected fund) in a month when market gets down ?
Appreciate your advise here. Thank you
Dear Vinoth,
Can you afford to take risk over the next 3 year period? May I know your risk appetite level (I mean, will you accept negative returns in short term)?
Dear Vinoth..If we look at numbers..to accumulate Rs 16 Lakh in 3 years with a monthly contribution of Rs 30k pm, the expected return is around 25%, which I believe is un-realistic (to expect).
As mutual funds do not generate guaranteed returns, this may or may not be achievable.
Thank you sir for your prompt reply and accumulating the return %. Regarding your first question. Yes, I can take risk. I know these days market is good but doubt about future of this high as this is unexpected for all of us.
In worst situation, I can even continue or hold till year 2022 even more. I know its better to invest in Mutual Funds rather than directly in shares as risk will be lesser.
What would be suggest. Should I go for MF or FD/RD? Just need your personal suggestion on this.
Many many thanks for doing this.
Thanks,
Vinoth
Dear Vinoth,
It all depends on whether you can afford to take risk or not?
You may consider a combination of FD/RD + Short term Debt fund + Arbitrage Fund + MIP Fund.
Ex – Franklin Low duration fund, ICICI Equity arbitrage fund, Birla MIP fund etc.,
These are debt oriented / hybrid funds, hence at max we can expect returns of around 7 to 10% over next 3 years, hence the desired corpus may not be achievable..
Thank you sir for your advise. This has given some idea on my future investment goal. Will plan accordingly.
God bless you.