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Ramalingam Kalirajan |8192 Answers |Ask -Follow

Mutual Funds, Financial Planning Expert - Answered on May 16, 2024

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

Question by sahibjyot on May 08, 2024Hindi

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Hello I am currently investing of around 13500 in mutual fund through sips 2500 in quant small cap, 2300 in Nippon India small cap , 1500 in kotak fof, 4200 in ICICI all seasons bond fund and 3000 in parag Parikh flexi too. My age is 24 i started last year in April and have accumulated a corpus of 180000, am I on the right path ?

Ans: Assessment of Your Investment Portfolio at 24

Congratulations on kickstarting your investment journey at such a young age! It's impressive that you've already built up a corpus of ?180,000 within just over a year. Let's delve into an evaluation of your current investment portfolio to ensure you're on the right path.

Diversification Evaluation

Diversification is like having a variety of dishes at a buffet, ensuring you have options even if one dish doesn't taste as good. Your portfolio seems to encompass a mix of equity and debt funds, which is a good start towards diversification.

Starting your investment journey at 24 reflects your proactive approach towards securing your financial future. Kudos to your financial prudence at such a young age!

It's commendable that you're seeking guidance to ensure your investments align with your long-term financial goals. It's perfectly normal to have doubts, especially when you're relatively new to investing.

Risk Assessment

At 24, you have time on your side, which means you can afford to take on more risk for potentially higher returns. Small-cap funds like Quant Small Cap and Nippon India Small Cap tend to be more volatile but offer the potential for significant growth over the long term.

Evaluation: While these funds can be rewarding, they also come with higher volatility and risk. It's crucial to ensure that your risk appetite aligns with the volatility of these investments.

Asset Allocation

Asset allocation is like baking a cake - you need the right ingredients in the right proportions for the perfect outcome. Your allocation seems skewed towards equity with only one debt fund, ICICI All Seasons Bond Fund.

Assessment: Since you're young, a higher allocation to equity is generally recommended for wealth accumulation over the long term. However, it's essential to periodically rebalance your portfolio to maintain the desired asset allocation.

Regular Monitoring

Just like watering a plant, regular monitoring and adjustments are necessary for your investment portfolio to thrive. Keep track of market trends, fund performance, and your financial goals to make informed decisions.

Evaluation: As you progress in your career and your financial goals evolve, consider reviewing and adjusting your investment strategy accordingly. Regular reviews with a Certified Financial Planner can provide valuable insights and ensure your investments stay aligned with your objectives.

Final Verdict

Overall, you've made a commendable start to your investment journey. However, to ensure you're on the right path, consider the following:

Regularly assess your risk tolerance and adjust your portfolio accordingly.
Keep an eye on the performance of your funds and make changes if necessary.
Continuously educate yourself about investing to make informed decisions.
Consider seeking professional advice from a Certified Financial Planner for personalized guidance.
Best Regards,

K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in

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.