Investing is easy! Figuring out ‘where to invest’ is the hard part. Irrespective of my quantum of earnings, I have been judiciously saving money for making investments.
As I opined, it can be a challenging task to identify right financial investments. I too learnt the investment lessons the hard way only.
I have been investing in Equities since 2003 and Mutual Funds from 2009 onwards. A major chunk of my investible surplus now goes towards mutual fund investments for two of my important financial goals i.e., my Son’s higher Education (six years to go) and my retirement (wealth accumulation).
Below is the investment planning process that I follow without fail for my financial goals.
My previous article on ‘my MF picks‘ (published in June, 2015) I had mentioned below mutual fund schemes as part of my portfolio;
Over the last 4 years, I have redeemed units of Birla Regular Savings Fund and utilized the proceeds, have redeemed units of TATA Balanced fund and re-invested in HDFC Hybrid Equity Fund.
I have also moved out of UTI Mid-cap Fund and started investing in Franklin Smaller Companies Fund since May, 2016. (Kindly note that I have remained invested for more than 6+ years in TATA & UTI fund before churning my portfolio).
I have very recently added UTI Nifty Next 50 Index Fund to my portfolio (from May 2019).
So, my existing mutual fund portfolio has below investments..
Some more important points on my investment planning & strategy..
So, are these the only best Mutual Fund Schemes to invest for your financial goals? – The answer is NO. These are just my Picks.
Please note that the above mentioned Mutual fund investments are done based on my financial risk profile and goals. This article is for information & knowledge sharing purposes only. If required, kindly take help of a Registered Investment Advisor in designing a Portfolio that is based on your requirements.
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(Image courtesy of iosphere at FreeDigitalPhotos.net) (Post published on : 21-June-2019)
This post was last modified on July 12, 2023 11:26 am
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Currently I invest on these three funds
1) Hdfc hybrid equity fund almost 9 years ongoing
2) Nifty next 50 for last one year ongoing
3) Parag parikh long term equity last. 5 month
Is it fine.
Regards
Pradipta
Dear Pradipta ..Looks fine to me..you may kindly continue with your investment plan..
Thanks Sreekanth for sharing the same. Just a suggestion if its suits you - if you can tell the % amount you have distributed in the selected funds and risk appetite which explains why the selection of these funds ... may be a new topic to start a thread ...... just a suggestion if you are comfortable in disclosing the same.
Dear Abhinav,
My current allocation is around 50 to 60% to Hybrid Fund, followed by ELSS fund, minor allocation to Small cap and Index Fund.
Hybrid fund gives me a downside protection to my portfolio, plus risk - reward trade off is much better in case of Equity Hybrid Funds.
I strongly believe that one can seriously consider a large cap index fund or Large midcapish index fund if one is looking for large-cap fund.
Thanks Sreekanth for your reply.
So 50 to 60% in hybrid is for long term Goals?? I believe in some other post (which i read now) you told 40:40:20 in midcap:elss:bal fund ... Anyways it's as per user risk profile. But i believe 40-45% would be good idea for Midcap/Small cap for long term (about 10+ yrs goals)
Dear Abhinav,
40:40:20 for my portfolio?
Kindly go ahead with your investment strategy/plan and conviction.
Do note that I factor in my family's investments and my investments in other Asset classes (especially, real estate ones) before allocating my investible surplus to my MF portfolio.
Also, I invest monies in HDFC hybrid fund for both medium + long term goals, hence higher allocation in % terms..
Dear Sreekanth, it would be good to know your strategies around real estate too. Are they part of this blog?
I was talking about:
this article ..
Below line under Long-Term Financial Goals
/* I have been holding TATA & UTI funds for the last 6 years or so. The percentage of allocation among these funds is 40:40:20 (UTI : Axis : TATA funds respectively). */
Dear Abhinav,
Got it!
Yeah, the allocation was way back in June 2015.
Hi Sreekanth,
First of all I want to thank you for your blog. You have been doing a fabulous job. Now coming to my question...
My age is 35. I have been investing in SIP since last 3 years. My current portfolio has the following mutual funds.
1. DSP Small cap fund (Investing since 03/2016)... 1K/Month
2. HDFC Mid Cap Opp (Investing since 03/2016)....2K/Month
3. Motilal Oswal Multicap 35 (Investing since 11/2017)......3K/Month
4. SBI Bluchip (Investing since 12/2016)......2K/Month
5. SBI Magnum Midcap (Investing since 03/2016)....1K/Month
6. Aditya Birla Sun Life Tax Relief 96 (Investing since 01/2018)......3K/Month
7. Reliance Small Cap (Investing since 01/2019)
Shall I continue with these funds?
Please do let me know if you need any other information which can help you to answer my query in a better way. Looking forward to hear from you. Thanks.
Dear Avisek,
Thank you for your appreciation!
May I know your investment objective(s) and time-frame??
Hi Sreekanth,
Many thanks for your reply..
My main investment goals are to arrange funds for my child's(2 years old) education, buying a house & also for my retirement. My investment horizon is long term, minimum 12-15 years.
Note: I have been also investing Rs.4000/Month in PPF since last 3 years.
Thanks.
Dear Avisek,
Your portfolio has two mid cap and two small cap based funds, can have higher risk profile.
Suggest you to check the funds portfolio overlap especially funds from same fund category and can try trim down your portfolio.
You may also look adding one pure Multi-cap fund and/or Aggressive hybrid fund to your portfolio.
Read :
* Mutual Fund Portfolio Overlap Comparison Tools
* Top Mutual Fund Schemes to invest in 2019 | Best Equity Funds for Long-Term
* Top 5 Best Aggressive Hybrid Equity Funds (Balanced Equity Mutual Funds)
What is market crash for you? Is there any specific rule that tells you it's right time to invest lump-sum?
Dear Arun,
One can track the Daily Moving Averages of Fund's respective NAV and its Benchmark Index to know if it is in Uptrend or Downtrend.
Related article : What is 200 Day Moving Average? | How to track DMAs? How to use them in Mutual Fund investment decisions?
Thank you Sreekanth for your quick response. However, I could not find it for "Franklin India Smaller Companies Fund". Can you help me find 200 day moving average for this?
Dear Arun,
In economic times portal, you can get the trend of NAV range - 'Monthly' & '52 week' and you can check the respective benchmark DMAs as mentioned in the above link (provided in the comment).
Sreekanth sir, I'm a regular reader of your blog. I'm also parking my money in MF. All short term/ mid term and long term in different MF schemes. Recently I came to know about a new feature of scam done by MF with our hard earned money. LT Finance was having reliance power shared pledged by AA or his company against the fund. The pledged shares were counted for cost around Rs. 60 at the time of lending money. Now the company has shown no willingness to pay money against pledged shares. They do not in position. So LT MF sold its share in market at Rs. 10 just few days back, and height is that.. the sold shares purchased by AA group company only, some other than the comapny came to pledged it. It means that they gave shares to LT MF @ 60 and buy back from MF @10. MF invested our hard earned money and ultimately it make loss of our money. LT MF has not invested anything from their pocket.
Can you show some way to find out such MF, which are involved in such dirty game? so retail invester like us can be saved. - Nimish
Dear Nimish,
I believe that SEBI is now contemplating to re-write some rules related to Pledging of shares..
Related article : Sebi tightens norms for MFs, pledged shares to boost investor confidence
Hi Sreekanth sir, You r doing a glorious job with these posts. No matter how, it comes with great responsibility.
I am in 30 now,have ppf,rd, ncd for debt part.Now planing to invest in MF,start with Parag Parikh Long Term Equity Fund - Direct Plan - a monthly SIP of 5000 for 10-15 years.I would like to do more MF invests in small cap,hybrid mf in a couple of years and all are for long term too. So what do u think about Parag Parikh Long Term Equity Fund for such a long term investment?
Hi Albin,
You can choose SBI Small Cap or HDFC Small Cap Fund. Both are great funds. Let me call on 75749 23412 for more information.
Dear albin,
Hope your NCD investments are with Popular companies.
PPLTE is a good bet.
You may go through this article..
Thank you so much.
Hi Sreekanth,
I have been investing for last couple of years using all the advice from you- so thanks for that.
Once again, need your guidance.
I am going to buy a property next month for which I shall be taking a home loan.
While I dont plan on and dont need to redeem my existing MF holdings, I will not be able to continue the SIPs once the home loan EMI starts.
Do you suggest it is OK to "stop" SIPs and stay invested till I can restart (may be in 2 years).
My MF portfolio is around 2-3 years old and giving me around 15% returns avg.
How should I go about it? Please advise.
Thank you!
Gaurav
Dear Gaurav,
How confident are you that your investible surplus (Income - expenses - EMIs etc) can be good after 2 years?
May I know your other financial goals (besides your Retirement..)
Hi Sreekanth,
Financial goals-
1. Buying this house for which I have the query
2. Retirement
3. Child's education and wedding(kid is 6 months old at this time)
4. Wealth generation
The reason I feel confident of investible surplus two years from now is that EMI + all current expenses will be 70% of our current income.
Over 2 years, the income will go up and so the saved percentage will increase beyond 30%.
Although expenses around the kid may also increase, I feel at least 25% can still be set aside as investible surplus.
Please advise.
Thanks
Gaurav
Dear Gaurav,
Ok. But, kindly do not over leverage (stretch) yourself regarding the budget (Property cost). Is this property for your self-occupation?
You may also go through this article @ Investing in Mutual Funds while paying Home Loan EMIs | Cost-Benefit Analysis
Hi Sreekanth,
Yes, property is for self- I currently live in a rented accommodation.
I read through the article, and seems like investing any surplus in MF through SIP while paying home loan EMI will be a good choice- I will plan accordingly, instead of hoarding up to prepay my home loan.
Please do advise on whether there will be any problem in "stopping" my current SIPs for some time though- till I can figure out how much I can invest and then restart my MF SIPs.
Or should I close all current SIPs and use them to increase downpayment on my loan?
Thanks
Gaurav
Dear Gaurav,
Suggest you not to redeem your existing MF Units for now.
Based on your financial position after 2 years or so, you can re-start your SIPs, may be, with slightly higher SIP amounts to achieve your long-term Fin goal values..
Sreekanth,
Thanks for sharing your portfolio and the changes in past few years.
Is this the end of road for UTI Midcap fund?
I was hoping that there could be a midcap rally this year that will prop up the returns of this fund.
Interesting to see you have moved from midcap to a smallcap fund.
Dear Pradeep,
Yes, there has been a correction in mid/small cap stocks last year and there is no decisive up-tick this year till date.
May I know the other scheme names that you have invested in (if any)??
Franklin SCF is a midcapish small cap oriented fund :)
Hi Sreekanth,
I am also investing in UTI Midcap. The other schemes are Franklin India Equity, Smaller Companies, Mirae Largecap. I started Kotak Emerging Equity as an alternative to UTI Midcap, but not yet stopped. Perhaps its time now?
Dear Pradeep,
Personally, I prefer HDFC Mid-cap or Franklin Prima funds in mid-cap space. These funds have very long track record and have seen different market cycles.
UTI mid-cap : The risk - return trade off is not in its favor and the fund's performance Vs its benchmark has not been well for the last 5 years or so.
Hi Sreekanth,
I ignored HDFC fund due to its size while I have 2 Franklin funds already. So I chose Kotak fund. But I agree that UTI fund isnt going back to the glory days of Anoop Bhaskar. I will also get out and possibly UTI Nifty Next 50 is an option.
Good to see your portfolio Sreekanth. It has balanced fund, small cap fund, index fund and tax saving fund. I usually invest in largecap and multipcap and midcap too along the above categories as these funds tend to perform differently in various market cycles.
Thank you dear Suresh for sharing your views!
I consider Tax saving Fund (Axis LTE) as a typical Multi-cap fund.
My portfolio has a higher allocation to Hybrid Fund, followed by ELSS fund, Small cap and then Index Fund.