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Ramalingam Kalirajan |10874 Answers |Ask -Follow
Mutual Funds, Financial Planning Expert - Answered on Jul 24, 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
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 AVP on Jul 24, 2025Hindi
Hi Sir. Hope you are doing well and thanks for the earlier great replies. My issue now is the fact that since i had more then 13 Mutual funds and all of them under Regular scheme and all this time, not a single fund manager called me nor guided me so i thought it foolish to pay for a service that i didn't get. Now i have cancelled all the SIPs but not withdrawn. So i have already invested in 1) Nippon India Gold Savings Fund -Direct- Rs 5000 2) HDFC Manufacturing Fund - Direct - Rs 5000. I am shying away from both Mid caps and Small caps as in most of the news it mentions that they are very much overvalued. Since i am planning to invest in another house, i might need this money and i dont want a major shock at the time of redemption. Now that you know my background, my question is- 1) can you suggest me some Mutual funds that are balanced both in terms of safety and growth? and 2) How many active mutual funds that one should ideally have? Is 13 a little too much. Large caps dont seem to give good returns in my view. Kindly share your thoughts.
Ans: You’ve already taken some wise steps.
You’ve invested. You’ve questioned the value received. You’ve paused, not withdrawn. That’s mature thinking.
Let’s build a 360-degree response, based on your needs and plans ahead.
? Regular Plan vs Direct Plan – Your Experience Matters
– You had over 13 mutual funds under regular plans.
– You didn’t get any guidance from those associated with the fund houses.
– That’s a genuine disappointment and very valid concern.
– But this is not a problem with regular plans themselves.
– The issue lies in choosing the wrong distributor or agent.
– Regular plans offer one big benefit: personalised advisory.
– But only if it comes from a Certified Financial Planner with accountability.
– If the CFP is involved, they guide you, monitor your portfolio, and advise proactively.
– Direct funds remove the support system.
– They expect you to do research, reviews, and rebalancing yourself.
– This is risky unless you’re experienced and emotionally detached from markets.
– So don’t judge regular plans as bad.
– Choose the right person behind the plan instead.
– A MFD with CFP certification gives goal-based strategies, not product pushing.
? Why 13 Mutual Funds is Excess
– Investing in too many funds leads to portfolio overlap.
– You may have five funds holding the same stocks.
– That kills the purpose of diversification.
– It adds confusion and dilutes tracking.
– Also, too many funds don’t always mean better returns.
– In fact, performance gets harder to monitor.
– Ideally, 5 to 7 funds are enough for most goals.
– Fund count depends on goals, not market fear or FOMO.
– Less funds with proper allocation perform better than a scattered portfolio.
? Fear of Mid and Small Caps – Your Caution is Logical
– News mentions overvaluation in mid and small caps.
– It’s partially true, especially in short-term perspective.
– These funds give higher growth, but come with sharper falls.
– Since you’re planning to buy a house, you need safer growth.
– You cannot afford capital loss when you need liquidity.
– So you’re right in avoiding these for now.
– Your awareness shows maturity. That’s a strength.
? Current Funds in Direct Plan – Key Observations
– You mentioned investing in Gold Savings and Manufacturing funds.
– Both are sector-focused or thematic in nature.
– Gold fund tracks international gold prices indirectly.
– Manufacturing fund is theme-based and comes with high sector risk.
– These are not ideal for short-term or house-linked goals.
– These should not be your core portfolio.
– You should avoid thematic or sector funds unless you have other base funds.
– Since real estate purchase is likely, shift your focus to hybrid funds now.
– These offer balance between growth and safety.
– Also, they handle short-term volatility better.
? Balanced Fund Category – Ideal for Your Current Need
– You need a mix of growth and capital safety.
– Hybrid funds (also called balanced funds) offer this mix.
– They combine equity and debt in one product.
– There are types of hybrid funds: conservative, balanced, aggressive.
– Choose based on your time frame and risk comfort.
– A certified planner can help fine-tune this selection.
– These funds adjust exposure based on market mood.
– They help protect you from big shocks at redemption.
– They also reduce emotional panic during market noise.
– For home-related goals, hybrid is a sensible category to start.
? Large Caps – Don’t Judge Them on Recent Performance
– Many feel large caps are underperforming.
– But their role is different from mid or small caps.
– They bring stability, not excitement.
– In market correction, large caps fall less.
– That’s why they remain core part of any smart portfolio.
– Don’t remove them completely. Use them with right expectation.
– If you chase returns only, you’ll move portfolio every year.
– That hurts wealth creation.
– Stick with proven active large cap funds chosen via proper research.
– A fund’s past one-year return is not the right way to judge.
? Keep Your Investment House-Goal Ready
– You said you might need funds for buying another house.
– So you must avoid funds with high equity exposure now.
– Any money needed within 3 years should not go into pure equity.
– Use conservative hybrid funds or short-term debt funds instead.
– These give low-to-moderate growth with limited volatility.
– That helps you when you redeem the funds later.
– You won’t get any major shocks.
– Capital safety becomes more important than chasing returns.
– Once house purchase is done, you can take higher equity exposure again.
? Mutual Fund Portfolio Structure – Keep It Clean
Equity allocation: Choose 2 or 3 diversified active equity funds.
Hybrid allocation: Choose 1 or 2 based on time frame.
Debt allocation: If goal is near, add 1 short-term or dynamic debt fund.
Avoid sector funds, international funds, NFOs, and FOMO-driven launches.
No need to hold more than 5–7 mutual funds.
Keep one fund per category. Don’t duplicate.
Stick to regular plans only via a committed CFP.
Review every 6 months. Don’t overreact to news or media noise.
? Avoid Direct Plans – Especially When Goals Are Emotional
– Direct plans offer low expense ratio. But there is no support.
– It suits those who study markets, monitor funds, and know asset allocation.
– But most investors don’t have that time or bandwidth.
– When goals like buying a house or child education come, panic starts.
– Direct plans offer no guidance at that stage.
– A CFP helps you with exit planning, taxation, rebalancing, and goal alignment.
– Paying a little extra gives clarity, confidence, and peace of mind.
– With regular plans via CFP, you gain professional handholding.
– That is more valuable than 0.5% savings in expense ratio.
? Final Insights
– You’ve done more right things than you give yourself credit for.
– You paused SIPs. You questioned your old strategy. You stayed invested.
– That itself shows you are thinking wisely now.
– Rebuild your portfolio with 5–7 active funds only.
– Avoid direct plans. Choose regular route with a Certified Financial Planner.
– Exit from sector or thematic funds slowly, if they don’t match your goals.
– Shift towards balanced hybrid or short-term debt options for near-term goals.
– Don’t chase return percentages. Chase risk control and goal alignment.
– You will create wealth by staying invested, reviewing smartly, and getting expert support.
– Avoid being your own advisor in complex times.
– Take help. Grow steady. Stay confident.
Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in
https://www.youtube.com/@HolisticInvestment
You’ve invested. You’ve questioned the value received. You’ve paused, not withdrawn. That’s mature thinking.
Let’s build a 360-degree response, based on your needs and plans ahead.
? Regular Plan vs Direct Plan – Your Experience Matters
– You had over 13 mutual funds under regular plans.
– You didn’t get any guidance from those associated with the fund houses.
– That’s a genuine disappointment and very valid concern.
– But this is not a problem with regular plans themselves.
– The issue lies in choosing the wrong distributor or agent.
– Regular plans offer one big benefit: personalised advisory.
– But only if it comes from a Certified Financial Planner with accountability.
– If the CFP is involved, they guide you, monitor your portfolio, and advise proactively.
– Direct funds remove the support system.
– They expect you to do research, reviews, and rebalancing yourself.
– This is risky unless you’re experienced and emotionally detached from markets.
– So don’t judge regular plans as bad.
– Choose the right person behind the plan instead.
– A MFD with CFP certification gives goal-based strategies, not product pushing.
? Why 13 Mutual Funds is Excess
– Investing in too many funds leads to portfolio overlap.
– You may have five funds holding the same stocks.
– That kills the purpose of diversification.
– It adds confusion and dilutes tracking.
– Also, too many funds don’t always mean better returns.
– In fact, performance gets harder to monitor.
– Ideally, 5 to 7 funds are enough for most goals.
– Fund count depends on goals, not market fear or FOMO.
– Less funds with proper allocation perform better than a scattered portfolio.
? Fear of Mid and Small Caps – Your Caution is Logical
– News mentions overvaluation in mid and small caps.
– It’s partially true, especially in short-term perspective.
– These funds give higher growth, but come with sharper falls.
– Since you’re planning to buy a house, you need safer growth.
– You cannot afford capital loss when you need liquidity.
– So you’re right in avoiding these for now.
– Your awareness shows maturity. That’s a strength.
? Current Funds in Direct Plan – Key Observations
– You mentioned investing in Gold Savings and Manufacturing funds.
– Both are sector-focused or thematic in nature.
– Gold fund tracks international gold prices indirectly.
– Manufacturing fund is theme-based and comes with high sector risk.
– These are not ideal for short-term or house-linked goals.
– These should not be your core portfolio.
– You should avoid thematic or sector funds unless you have other base funds.
– Since real estate purchase is likely, shift your focus to hybrid funds now.
– These offer balance between growth and safety.
– Also, they handle short-term volatility better.
? Balanced Fund Category – Ideal for Your Current Need
– You need a mix of growth and capital safety.
– Hybrid funds (also called balanced funds) offer this mix.
– They combine equity and debt in one product.
– There are types of hybrid funds: conservative, balanced, aggressive.
– Choose based on your time frame and risk comfort.
– A certified planner can help fine-tune this selection.
– These funds adjust exposure based on market mood.
– They help protect you from big shocks at redemption.
– They also reduce emotional panic during market noise.
– For home-related goals, hybrid is a sensible category to start.
? Large Caps – Don’t Judge Them on Recent Performance
– Many feel large caps are underperforming.
– But their role is different from mid or small caps.
– They bring stability, not excitement.
– In market correction, large caps fall less.
– That’s why they remain core part of any smart portfolio.
– Don’t remove them completely. Use them with right expectation.
– If you chase returns only, you’ll move portfolio every year.
– That hurts wealth creation.
– Stick with proven active large cap funds chosen via proper research.
– A fund’s past one-year return is not the right way to judge.
? Keep Your Investment House-Goal Ready
– You said you might need funds for buying another house.
– So you must avoid funds with high equity exposure now.
– Any money needed within 3 years should not go into pure equity.
– Use conservative hybrid funds or short-term debt funds instead.
– These give low-to-moderate growth with limited volatility.
– That helps you when you redeem the funds later.
– You won’t get any major shocks.
– Capital safety becomes more important than chasing returns.
– Once house purchase is done, you can take higher equity exposure again.
? Mutual Fund Portfolio Structure – Keep It Clean
Equity allocation: Choose 2 or 3 diversified active equity funds.
Hybrid allocation: Choose 1 or 2 based on time frame.
Debt allocation: If goal is near, add 1 short-term or dynamic debt fund.
Avoid sector funds, international funds, NFOs, and FOMO-driven launches.
No need to hold more than 5–7 mutual funds.
Keep one fund per category. Don’t duplicate.
Stick to regular plans only via a committed CFP.
Review every 6 months. Don’t overreact to news or media noise.
? Avoid Direct Plans – Especially When Goals Are Emotional
– Direct plans offer low expense ratio. But there is no support.
– It suits those who study markets, monitor funds, and know asset allocation.
– But most investors don’t have that time or bandwidth.
– When goals like buying a house or child education come, panic starts.
– Direct plans offer no guidance at that stage.
– A CFP helps you with exit planning, taxation, rebalancing, and goal alignment.
– Paying a little extra gives clarity, confidence, and peace of mind.
– With regular plans via CFP, you gain professional handholding.
– That is more valuable than 0.5% savings in expense ratio.
? Final Insights
– You’ve done more right things than you give yourself credit for.
– You paused SIPs. You questioned your old strategy. You stayed invested.
– That itself shows you are thinking wisely now.
– Rebuild your portfolio with 5–7 active funds only.
– Avoid direct plans. Choose regular route with a Certified Financial Planner.
– Exit from sector or thematic funds slowly, if they don’t match your goals.
– Shift towards balanced hybrid or short-term debt options for near-term goals.
– Don’t chase return percentages. Chase risk control and goal alignment.
– You will create wealth by staying invested, reviewing smartly, and getting expert support.
– Avoid being your own advisor in complex times.
– Take help. Grow steady. Stay confident.
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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