Good Afternoon Sir , last two years i am investing in Parag Parikh flaxi cap- (2500 Rs. Direct) , Axis small cap -( 2500-Direct) , Hdfc Small cap-( 1000 Direct ), Icici value discovery (2500 ), Axis Blue chip-(2500) , Mirah Emerging Bluechip ( 2500) , Tata Digital India ( 1000 Rs.). request to you kindly guided me am i on right track. my investment horizon almost 12-15 years . also i am doing sip for my kids in sbi samll cap (1000 Rs. ) kotak small cap(1000) Pgim mid cap ( 2000) for next 15 years because my both kids are at 18 years old. please suggest me on these also .
Ans: Your commitment to investing for the future is commendable. Investing with a horizon of 12-15 years provides ample time for your investments to grow. Let’s review and optimise your portfolio for better returns and balanced risk.
Current Investment Overview
Your current investments include a mix of small-cap, mid-cap, flexi-cap, and sectoral funds. Diversification across these categories is a prudent strategy, reducing risk and enhancing potential returns.
Analysing Fund Selection
Your selection of funds indicates a balanced approach. Small-cap and mid-cap funds offer high growth potential but come with higher risk. Flexi-cap and large-cap funds provide stability, balancing your portfolio.
Investment in Direct Funds
Direct funds have lower expense ratios, increasing your returns over time. However, they lack the professional guidance available through regular plans. Investing through a Certified Financial Planner can provide tailored advice and oversight.
Disadvantages of Index Funds
Index funds track market indices, potentially limiting returns. They lack the adaptability of actively managed funds, which adjust to market conditions for better performance.
Advantages of Actively Managed Funds
Actively managed funds offer professional management, adapting to market changes. This flexibility can result in higher returns compared to passive index funds.
Kids’ Investment Portfolio
Investing for your kids' future in small-cap and mid-cap funds is a smart choice. These funds have the potential for higher returns over a long investment horizon. Ensure you periodically review and adjust the portfolio as needed.
Periodic Review and Rebalancing
Regularly reviewing and rebalancing your portfolio ensures it remains aligned with your financial goals. This proactive approach optimises returns and manages risks effectively.
Creating a Comprehensive Financial Plan
Consider other financial aspects like emergency funds, insurance, and tax planning. A holistic financial plan ensures a secure and well-rounded approach to wealth creation.
Monitoring Market Trends
Stay informed about market trends and economic factors. This knowledge helps you make timely adjustments to your investments, maximising returns and mitigating risks.
Conclusion
Your disciplined investment strategy and diversified portfolio are commendable. With regular review and professional guidance, you can achieve your financial goals and secure a bright future for your family.
Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in