New investor seeks advice: Are my chosen small-cap and mid-cap funds a good fit?

Ans: Assessing Your Mutual Fund Portfolio
Current Investment Overview
Nippon India Index Fund

Investing Rs. 1,000 per month
Index funds passively track the market
Nippon Small Cap Fund

Investing Rs. 1,000 per month
Focuses on small-cap stocks
Quant Small Cap Fund

Investing Rs. 1,000 per month
Invests in small-cap companies
Quant Infrastructure Fund

Investing Rs. 1,000 per month
Targets infrastructure sector
HDFC Defence Fund

Investing Rs. 1,000 per month
Invests in defence sector
Motilal Oswal Midcap Fund

Investing Rs. 1,000 per month
Focuses on mid-cap stocks
Evaluating Your Investments
Index Fund Analysis
Disadvantages of Index Funds:

Limited to market performance
Lack of flexibility in stock selection
Higher exposure to market downturns
Advantages of Actively Managed Funds:

Potential for higher returns through stock selection
Professional fund management
Ability to adapt to market conditions
Small Cap Fund Analysis
Nippon Small Cap Fund:

Good for long-term growth
Higher risk due to small-cap volatility
Quant Small Cap Fund:

Similar benefits and risks
Diversifies small-cap exposure
Sector Fund Analysis
Quant Infrastructure Fund:

High potential in growing infrastructure sector
Risk of sector-specific downturns
HDFC Defence Fund:

Growth potential in defence sector
High risk due to sector focus
Mid Cap Fund Analysis
Motilal Oswal Midcap Fund:
Balanced approach between large-cap stability and small-cap growth
Suitable for long-term investment
Portfolio Diversification and Risk Management
Current Allocation:

Heavy focus on small-cap and sector-specific funds
Higher risk due to concentration
Recommended Approach:

Maintain a balance between different fund types
Include more diversified equity funds for stability
Consider adding large-cap funds for balanced growth
Suggested Actions
Portfolio Adjustment
Reduce Sector-Specific Funds:

Reduce allocation in infrastructure and defence funds
Allocate more to diversified funds
Balanced Fund Mix:

Include large-cap and diversified equity funds
Maintain small-cap and mid-cap exposure for growth
Long-Term Strategy
Investment Horizon:

Focus on long-term growth
Regularly review and adjust portfolio
Risk Tolerance:

Assess risk tolerance periodically
Ensure alignment with financial goals
Final Insights
Balanced Approach: Diversify across fund types to manage risk
Regular Review: Monitor and adjust portfolio periodically
Professional Guidance: Consult a Certified Financial Planner for personalized advice
Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in