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Ramalingam

Ramalingam Kalirajan  |8482 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jan 13, 2025

Ramalingam Kalirajan has over 23 years of experience in mutual funds and financial planning.
He has an MBA in finance from the University of Madras and is a certified financial planner.
He is the director and chief financial planner at Holistic Investment, a Chennai-based firm that offers financial planning and wealth management advice.... more
Asked by Anonymous - Jan 13, 2025
Money

Given the significant drop in Sensex and Nifty50, how should individuals with systematic investment plans (SIPs) approach their investments? Should they increase their contributions?

Ans: A market dip presents a unique opportunity for SIP investors. Assess your SIP contributions. Ensure they align with your long-term financial goals. Market fluctuations are normal and temporary.

Benefits of Market Corrections
When markets drop, you get more units for the same SIP amount. This is rupee cost averaging in action. Over time, it reduces the average cost per unit. This helps in compounding returns.

Should You Increase SIP Contributions?
Increasing SIPs in a market dip can be rewarding. If your finances allow, enhance contributions. It amplifies long-term wealth creation. But avoid overburdening your budget.

Revisit Financial Goals
Ensure SIPs match your future aspirations. Align them with your retirement, child’s education, or wealth-building goals. Clarity helps maintain focus.

Assess Risk Appetite
Understand your risk tolerance during volatile markets. Stick to your planned asset allocation. Avoid panic-driven decisions.

Avoid Stopping SIPs
Stopping SIPs during corrections hampers wealth creation. Continue investing regularly. It benefits from market recovery.

Monitor Fund Performance
Track the performance of your selected funds. Ensure they meet benchmarks and objectives. Replace underperformers with better alternatives if needed.

Benefits of Regular Fund Investing with CFP
Regular funds provide professional guidance. They include a Certified Financial Planner’s expertise. Direct funds lack advisory benefits. They might miss personalized strategies.

Actively Managed Funds Over Index Funds
Index funds follow the market. They don’t outperform it. Actively managed funds can beat indices. Fund managers identify growth opportunities.

Tax Implications of Selling SIP Units
Equity funds’ LTCG above Rs 1.25 lakh is taxed at 12.5%. STCG is taxed at 20%. Debt fund gains are taxed as per your slab. Plan redemptions wisely.

Focus on Long-Term Vision
Market fluctuations are temporary. SIPs are for long-term goals. Patience ensures better results.

Maintain Emergency Corpus
Ensure an emergency fund before increasing SIPs. It covers unexpected expenses. It prevents financial stress.

Review Insurance Policies
Check existing LIC or ULIP policies. They may offer lower returns. Consider surrendering low-performing policies. Reinvest in mutual funds for better growth.

Seek Certified Financial Planner’s Guidance
A Certified Financial Planner offers personalized advice. They align investments with your goals. They help maximize returns.

Finally
Market dips are opportunities, not threats. Continue SIPs with discipline. Align contributions with goals and risk. Seek professional guidance when needed.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in
https://www.youtube.com/@HolisticInvestment
DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Users are advised to pursue the information provided by the rediffGURU only as a source of information to be as a point of reference and to rely on their own judgement when making a decision.
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Ramalingam

Ramalingam Kalirajan  |8482 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Apr 30, 2024

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I am investing in SIP since last 5 years. My age is 34. Salary - 70K. Icici bluechip - 3K, icici pharma healthcare - 4k, Quant Flexicap - 5K, Quant smallcap -1.5K, Quant ELSS - 3K, SBI Multicap - 2K, Sbi Magnum midcap - 1K, Tata Digital India - 2K, Hdfc hybrid equity - 2K. Kindly give your valuable suggestions & changes to be made.
Ans: It's impressive to see your dedication to SIP investing over the past five years, especially at your age. Your portfolio showcases a blend of funds across various sectors and market caps, reflecting a diversified approach to wealth creation.

However, let's examine your current allocations. Are you comfortable with the level of risk in your portfolio? Given your age and income, it's essential to ensure that your investments align with your risk tolerance and financial goals.

Consider consolidating your holdings to streamline your portfolio. Are there any overlapping funds or sectors? Simplifying your investments can make it easier to track and manage them effectively.

Furthermore, assess the performance of each fund regularly. Are there any underperformers or funds that no longer fit your investment thesis? Just as a gardener prunes branches to encourage growth, trimming your portfolio may enhance its overall health and performance.

Lastly, stay informed about market trends and economic developments. Are there any emerging sectors or themes that warrant attention? Adapting your portfolio to capitalize on opportunities can potentially boost returns over the long term.

In summary, while your current portfolio displays a commendable commitment to wealth creation, periodic review and adjustments are crucial for optimizing performance and aligning with your financial objectives. Keep nurturing your investments with care, and they're likely to flourish in the years ahead.

..Read more

Ramalingam

Ramalingam Kalirajan  |8482 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Apr 26, 2024

Asked by Anonymous - Apr 26, 2024Hindi
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Money
Hi i am 40 years old and working in private sector. Current investments in SIP's are UTI index and I Pru next 50 @ 1000/weekly, Nippon Small Cap @ 1500/Weekly also HDFC Mid cap opportunites @ 1000/weekly. I also have monthly SIP's in Canara Robeco Emerging Equities @ 2000,Invesco Multicap @ 2500, Mirae Emerging Bluechip @ 2500, Mirae NYSE Fang ETF FOF @ 5000, Quant Small cap @ 2000, PPFAS flexicap @ 2500, UT Flexi @ 2500. Most of the SIP's have been started in last 2-3 yeasr.
Ans: It's commendable that you've taken proactive steps towards securing your financial future, especially with such a diverse portfolio of SIPs. At 40, you're in a crucial phase of life where every investment decision counts. Your commitment to regular investing reflects a thoughtful approach to wealth accumulation.

With SIPs spread across various sectors, you've embraced the beauty of diversification. But have you ever pondered over whether your current investments truly align with your long-term goals and risk appetite? It's crucial to periodically reassess your portfolio's composition to ensure it remains in sync with your evolving financial aspirations.

Remember, the journey to financial independence is akin to a marathon, not a sprint. Each SIP contribution represents a step forward on this journey, building wealth brick by brick. As a Certified Financial Planner, I appreciate your dedication to securing your financial future and encourage you to continue this journey with wisdom and foresight.

In the vast landscape of investment opportunities, your portfolio reflects a tapestry of choices tailored to your vision. But as with any masterpiece, periodic reflection and adjustment are essential to ensure its continued brilliance. Let's navigate this journey together, crafting a future that's both prosperous and fulfilling, one SIP at a time.

..Read more

Ramalingam

Ramalingam Kalirajan  |8482 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Mar 24, 2025

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I am 58 now still working, I investing through SIP in Mutual funds @ 3000/-pm 1. Tata Small cap direct fund 2. ICICI Pru technology 3. HDFC Balanced advantage fund 4 Canara Roboco Multi cap 5. Axis smal cap, and Lump sum in 1 Nippon Large cap (50k) 2 Quant small cap (1.40l) 3. Quant Infra (1 lak), 4. ICICI commodities (50k) 5. Canara Roboco small cap (50k), 6. Aditya Birla Sunlife PSU equity (30k) But now the value it is declining gradually. Kindly advise
Ans: Your portfolio consists of SIPs and lump sum investments in mutual funds across multiple categories. You have exposure to small-cap, multi-cap, balanced advantage, technology, large-cap, infrastructure, commodities, and PSU equity funds.

Observations on Your Portfolio
High Exposure to Small-Cap Funds

You have three small-cap funds in SIP and three in lump sum.

Small-cap funds are highly volatile and take time to deliver returns.

Overexposure can lead to sharp fluctuations.

Sectoral and Thematic Funds

You hold technology, infrastructure, commodities, and PSU equity funds.

These funds depend on sector-specific performance.

Sectors go through cycles of growth and slowdown.

High allocation to sectoral funds increases risk.

Balanced Advantage Fund

This fund aims to balance equity and debt.

It reduces volatility but may not generate high growth.

Large-Cap and Multi-Cap Exposure

Your portfolio has only one large-cap fund and one multi-cap fund.

Large-cap funds provide stability, but exposure is low.

Multi-cap funds help diversification, but allocation is limited.

Why Your Portfolio Value is Declining
Market Volatility

Small-cap and sectoral funds react sharply to market movements.

A temporary decline does not mean a permanent loss.

Sector-Specific Performance

Technology, commodities, and infrastructure sectors may be underperforming.

These funds perform well only in favorable market conditions.

Economic and Global Factors

Interest rates, inflation, and global market trends impact sectoral funds.

A broad-based correction affects small-cap and thematic funds first.

Steps to Improve Your Portfolio
1. Reduce Small-Cap Exposure
Limit small-cap funds to one or two funds only.

Redeploy part of the funds into flexi-cap or large-cap funds.

Keep SIP in only one small-cap fund instead of two.

2. Reduce Sectoral Fund Dependence
Exit or reduce allocation in sectoral funds if they exceed 20% of your total portfolio.

Consider moving funds to diversified equity funds.

Retain sectoral funds only if you can handle volatility.

3. Increase Large-Cap and Multi-Cap Allocation
Large-cap funds offer stability and consistent returns.

Multi-cap funds adjust allocation dynamically across market caps.

Add or increase SIP in large-cap or flexi-cap funds.

4. Maintain Balanced Asset Allocation
Include a mix of equity, debt, and hybrid funds for stability.

Balanced advantage funds provide some protection in volatile markets.

Consider increasing exposure to hybrid funds for risk management.

5. Stick to Long-Term Investing
Markets move in cycles, and temporary declines are normal.

Continue your SIPs without panic.

Monitor performance but avoid frequent changes.

6. Review and Rebalance Every Year
Check fund performance annually.

Exit funds that consistently underperform their category.

Shift funds based on market trends and your risk tolerance.

Final Insights
Your portfolio is high-risk due to small-cap and sectoral fund exposure.

Reducing allocation in small-cap and thematic funds will lower volatility.

Increasing large-cap and multi-cap allocation will bring balance.

Staying invested for the long term will help you recover losses.

Avoid frequent fund switches, and review your portfolio annually.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in
https://www.youtube.com/@HolisticInvestment

..Read more

Latest Questions
Nayagam P

Nayagam P P  |4699 Answers  |Ask -

Career Counsellor - Answered on May 21, 2025

Career
Sir, I have got 87% marks in mains. Please tell me a college where I can get a branch.
Ans: Aditi, Here is, How to Predict Your Chances of Admission into NIT or IIIT or GFTI After JEE Main/Advanced Results – A Step-by-Step Guide

Providing precise admission chances for each student can be challenging. Some reputed educational websites offer ‘College Predictor’ tools where you can check possible college options based on your percentile, category, and preferences. However, for a more accurate understanding, here’s a simple yet effective 9-step method using JoSAA’s past-year opening and closing ranks. This approach gives you a fair estimate (though not 100% exact) of your admission chances based on the previous year’s data.

Step-by-Step Guide to Check Your Admission Chances Using JoSAA Data
Step 1: Collect Your Key Details
Before starting, note down the following details:

Your JEE Main percentile
Your category (General-Open, SC, ST, OBC-NCL, EWS, PwD categories)
Preferred institute types (NIT, IIIT, GFTI)
Preferred locations (or if you're open to any location in India)
List of at least 3 preferred academic programs (branches) as backups (instead of relying on just one option)
Step 2: Access JoSAA’s Official Opening & Closing Ranks
Go to Google and type: JoSAA Opening & Closing Ranks 2024
Click on the first search result (official JoSAA website).
You will land directly on JoSAA’s portal, where you can enter your details to check past-year cutoffs.
Step 3: Select the Round Number
JoSAA conducts five rounds of counseling.
For a safer estimate, choose Round 4, as most admissions are settled by this round.
Step 4: Choose the Institute Type
Select NIT, IIIT, or GFTI, depending on your preference.
If you are open to all types of institutes, check them one by one instead of selecting all at once.
Step 5: Select the Institute Name (Based on Location)
It is recommended to check institutes one by one, based on your preferred locations.
Avoid selecting ‘ALL’ at once, as it may create confusion.
Step 6: Select Your Preferred Academic Program (Branch)
Enter the branches you are interested in, one at a time, in your preferred order.
Step 7: Submit and Analyze Results
After selecting the relevant details, click the ‘SUBMIT’ button.
The system will display Opening & Closing Ranks of the selected institute and branch for different categories.
Step 8: Note Down the Opening & Closing Ranks
Maintain a notebook or diary to record the Opening & Closing Ranks for each institute and branch you are interested in.
This will serve as a quick reference during JoSAA counseling.
Step 9: Adjust Your Expectations on a Safer Side
Since Opening & Closing Ranks fluctuate slightly each year, always adjust the numbers for safety.
Example Calculation:
If the Opening & Closing Ranks for NIT Delhi | Mechanical Engineering | OPEN Category show 8622 & 26186 (for Home State), consider adjusting them to 8300 & 23000 (on a safer side).
If the Female Category rank is 34334 & 36212, adjust it to 31000 & 33000.
Follow this approach for Other State candidates and different categories.
Pro Tip: Adjust your expected rank slightly lower than the previous year's cutoffs for realistic expectations during JoSAA counseling.

Can This Method Be Used for JEE April & JEE Advanced?
Yes! You can repeat the same steps after your April JEE Main results to refine your admission possibilities.
You can also follow a similar process for JEE Advanced cutoffs when applying for IITs.

Also, please have some other back-up options instead of relying only on JEE/JoSAA/NITs/IIITs/GFTIs.

Want to Learn More About JoSAA Counseling?
If you want detailed insights on JoSAA counseling, engineering entrance exams, preparation strategies, and engineering career options, check out EduJob360’s 180+ YouTube videos on this topic!

Hope this guide helps! All the best for your admissions and a bright future!

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DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Investment in securities market are subject to market risks. Read all the related document carefully before investing. The securities quoted are for illustration only and are not recommendatory. Users are advised to pursue the information provided by the rediffGURU only as a source of information and as a point of reference and to rely on their own judgement when making a decision. RediffGURUS is an intermediary as per India's Information Technology Act.

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