Portfolio planning - Q & A Forum

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ramkumar asked 9 years ago

Hi Sreekanth, In the past, you had provided me valuable information on investment. Thanks for that. Now I need your suggestion to plan my investments. I am 29 years old. From last year, I have invested 700 per month in Axis long term equity fund for retirement planning and tax reasons. Also, I have a Max life term insurance. From this month, I would like to invest to invest Rs.8000 more in the mutual funds. I thought I will take one balanced fund (TATA or HDFC) for short term requirement. Another fund for long term (>20 years), I am not clear which one (large, mid or small cap). So, please suggest me a fund.Is Franklin India smaller cos fund, a good choice in my case.. Also, please suggest how much to divide the 800 in these two funds. Thanks in advance.

2 Answers

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Sreekanth Staff answered 9 years ago

Hi, Can you define what is 'short term'? If it is around 5 years, then you may kindly consider the balanced fund. For >20 year horizon - You may consider one Mid-cap & one Small cap fund. Ex - HDFC Mid-cap opportunities or UTI mid-cap or Mirae Asset Emerging Bluechip Franklin Smaller Companies fund or DSP Micro cap. So, your portfolio will have Axis LTE (multicap cum ELSS), a balanced fund, a mid-cap fund and a small cap fund. You may allocate higher % to mid&small cap funds than to a balanced fund. Kindly read: http://www.relakhs.com/best-mutual-fund-scheme-risk-ratios/ http://www.relakhs.com/mutual-fund-portfolio-overlap-comparison-tools/ http://www.relakhs.com/mutual-fund-categories-market-capitalization-large-cap-vs-mid-cap-vs-small-cap-funds/

ramkumar replied 9 years ago

Thanks for your suggestion Sreekanth. Im planning to buy a house. So, i referred to it as short term to have an amount to spend on the principal or to reduce the emi for the home loan. My long term plan is for my kid’s education.

My plan (per month):
Axis lte fund-Rs. 7000
Hdfc balanced fund-Rs. 2000
Mirae asset blue chip-Rs. 2000
Franklin ind smaller cos – Rs. 4000

Total-Rs.15000 per month
Please let me know your opinion on this.
Also, in future if i want to add more amount, can i invest in the mid cap?
Thanks in advance.

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Sreekanth Staff answered 9 years ago

Hi, Portfolio looks fine. You may add additional amounts to mid/small cap for your long-term goals, atleast for next few years or so. Kindly go through below articles; http://www.relakhs.com/calculate-kids-education-goal-amount/ http://www.relakhs.com/retirement-planning-calculator-3-easy-steps/ http://www.relakhs.com/personal-financial-planning-articles-list/