Home > Money > Question
Need Expert Advice?Our Gurus Can Help
Ramalingam

Ramalingam Kalirajan  |7921 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on May 29, 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
Parvinder Question by Parvinder on Jul 11, 2023Hindi
Listen
Money

I am investing in following funds through SIP 1. HDFC top 200 Regular Growth since 2010 Rs. 3000 2. ICICI PRUDENTIAL LARGE & MIDCAP FUND GROWTH SINCE 2014 Rs. 2000 3. BANDHAN FLEXICAP FUND-GROWTH SINCE 2011 Rs. 2000 4. BSL FRONTLINE EQUITY FUND - GROWTH SINCE 2010 Rs. 3000 (STOPPED SIP IN 2020) 5. MIRAE ASSET BLUECHIP FUND - GROWTH SINCE 2021 Rs. 2500 6. HDFC FLEXI CAP - GROWTH SINCE 2022 Rs. 5500 PLEASE ADVICE ME WHETHER I SHOULD CONTINUE WITH THESE FUNDS OR EXIT. I FURTHER WANT TO INVEST Rs. 15000 MORE. PLEASE SUGGEST WHETHER I SHOULD INCREASE SIP AMOUNT IN THESE FUNDS OR START SIP IN NEW FUND

Ans: Assessing Your Mutual Fund Investments and Planning for the Future

Your portfolio demonstrates a disciplined approach to mutual fund investing over the years. Let's evaluate your current holdings and chart a course for future investments.

Analyzing Existing SIPs

HDFC Top 200, ICICI Prudential Large & Midcap, and Bandhan Flexicap Funds have been part of your investment journey for several years. These funds offer exposure to different market segments, providing diversification benefits.

BSL Frontline Equity Fund, while stopped in 2020, has a long track record of performance. It's essential to review the reasons for discontinuing this SIP and assess whether it aligns with your current investment strategy.

Mirae Asset Bluechip Fund and HDFC Flexi Cap Fund, initiated more recently, contribute to diversification and may offer growth potential.

Evaluating Performance and Suitability

Review the performance of each fund relative to its benchmark and peer group. Assess whether the fund manager's investment approach and strategy align with your risk tolerance and investment objectives.

Consider the consistency of returns, risk-adjusted performance, and fund management quality. Additionally, evaluate the fund's expense ratio and turnover ratio to ensure cost-effectiveness.

Deciding Whether to Continue or Exit

Continue SIPs in funds with consistent performance, robust fundamentals, and alignment with your investment goals.

Consider exiting funds that consistently underperform their benchmarks or peers, have experienced significant changes in fund management, or deviate from your risk profile.

Planning Additional Investments

Given your intention to invest an additional Rs. 15,000, consider the following options:

Increase SIP amounts in existing funds with proven track records and growth potential. This approach maintains continuity and capitalizes on the strengths of your current portfolio.

Explore new funds that complement your existing holdings and provide exposure to underrepresented sectors or asset classes. Conduct thorough research and seek professional advice to identify suitable options.

Seeking Professional Guidance

As a Certified Financial Planner, I recommend conducting a comprehensive portfolio review to ensure alignment with your financial goals and risk tolerance. Regular monitoring and periodic adjustments are essential to optimize your investment outcomes.

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.
Money

You may like to see similar questions and answers below

Ramalingam

Ramalingam Kalirajan  |7921 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on May 20, 2024

Listen
Money
I am having following 6 regular SIPs in mutual funds 1. SBI Contra Fund Rs 2,000/- 2. SBI Small Cap Fund ,000/- 3. SBI Retirement Benefit Fund Aggressive Growth Rs 2,000/- 4. SBI PSU Fund lumpsum Rs 11000/- 5. Quant Small Cap Fund Rs 1000/- 6. ICICI Prudential Infrastructure Growth Fund 500/- Please advise whether I should continue with these funds or exit. Aloke
Ans: Review and Recommendations for Your Mutual Fund Portfolio
Overview of Your Current Investments
You have a diversified portfolio with the following SIPs and a lump sum investment:

SBI Contra Fund: ?2,000/- per month
SBI Small Cap Fund: ?2,000/- per month
SBI Retirement Benefit Fund Aggressive Growth: ?2,000/- per month
SBI PSU Fund: Lump sum ?11,000/-
Quant Small Cap Fund: ?1,000/- per month
ICICI Prudential Infrastructure Growth Fund: ?500/- per month
Compliments on Your Investment Strategy
Your disciplined approach to investing through regular SIPs is commendable. Investing in a variety of funds shows your understanding of diversification. This strategy helps mitigate risks and enhances the potential for growth.

Analytical Review of Your Portfolio
SBI Contra Fund:

Contra funds invest in undervalued stocks, anticipating future growth.
These funds can offer high returns but come with increased risk.
Consider if this aligns with your risk tolerance and investment horizon.
SBI Small Cap Fund:

Small cap funds can generate significant growth over time but are highly volatile.
Ensure this fund aligns with your risk appetite and long-term goals.
SBI Retirement Benefit Fund Aggressive Growth:

This fund focuses on long-term growth for retirement.
It's a good choice for aggressive investors aiming for high returns over time.
SBI PSU Fund:

Investing in Public Sector Units can be beneficial but is sector-specific and carries concentration risk.
Regularly review this fund's performance and the overall sector outlook.
Quant Small Cap Fund:

Like the SBI Small Cap Fund, this fund offers high growth potential with high risk.
Diversifying within the small cap segment might not be necessary.
ICICI Prudential Infrastructure Growth Fund:

Infrastructure funds invest in infrastructure-related companies.
These funds can provide good returns during economic growth periods but are sector-specific and volatile.
Recommendations for Portfolio Improvement
Diversify Across Market Caps and Sectors:

Your portfolio has a significant focus on small cap and sector-specific funds.
Consider adding a large cap or a diversified equity fund to balance risk and stability.
Consolidate Small Cap Investments:

Holding multiple small cap funds may not be necessary.
You can consolidate into one fund to avoid overlap and simplify management.
Review Sector-Specific Funds:

Sector-specific funds like PSU and Infrastructure can be volatile.
Regularly monitor their performance and consider switching to more diversified funds if needed.
Consider Professional Management:

Direct funds have lower expenses but require active monitoring.
Investing through a certified financial planner can provide professional management and potentially better returns.
Steps for Continued Success
Regular Portfolio Reviews:

Periodically review your portfolio to ensure it aligns with your goals and market conditions.
Make adjustments as needed to stay on track.
Increase SIP Amounts Gradually:

As your income grows, consider increasing your SIP amounts.
This will help you build a larger corpus over time.
Maintain an Emergency Fund:

Ensure you have an emergency fund to cover unexpected expenses.
This prevents the need to withdraw from your investments prematurely.
Stay Informed and Educated:

Stay updated on market trends and financial news.
Continuous learning will help you make informed investment decisions.
Conclusion
Your current portfolio is well-diversified but has a significant focus on small cap and sector-specific funds. Consider balancing it with more stable large cap or diversified equity funds. Regularly review and adjust your investments to align with your goals and risk tolerance. Your disciplined investment strategy and thoughtful planning are commendable. With consistent efforts and regular reviews, you are well on your way to achieving your financial goals.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

..Read more

Ramalingam

Ramalingam Kalirajan  |7921 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on May 19, 2024

Listen
Money
Sir, I have SIPs in following fund: 1) ICICI Pru Bluechip Fund - Rs. 2000; 2) Mirae Asset Large Cap Fund - Rs. 1000; 3) HSBC Mid Cap Fund - Rs. 2000; 4) Nippon Small Cap Fund - Rs. 1000; 5) ICICI Pru Flexicap Fund - Rs. 2000; 6) HDFC Flexicap Fund - Rs. 2000; 7) ICICI Nifty IT Index Fund - Rs. 1000; 8) Motilal S&P 500 Fund - Rs. 1000; 9) Nippon India Silver ETF FOF - Rs. 1000. Should I continue?
Ans: Your disciplined approach to investing through Systematic Investment Plans (SIPs) is commendable. Diversifying across various fund categories shows a thoughtful strategy. Let’s analyse your portfolio in detail.

Large Cap Funds
You have investments in two large cap funds. These funds focus on established companies, providing stability and moderate growth.

Large cap funds are generally less volatile and offer steady returns, making them suitable for long-term goals.

Mid Cap and Small Cap Funds
Your portfolio includes mid cap and small cap funds. Mid cap funds invest in medium-sized companies, which can offer higher growth potential but come with increased risk.

Small cap funds invest in smaller companies, which are riskier but have significant growth potential.

Flexicap Funds
You have SIPs in two flexicap funds. Flexicap funds provide flexibility by investing across large, mid, and small cap stocks. This diversification within a single fund can enhance returns and reduce risk.

Sector and Thematic Funds
The inclusion of a sector-specific fund, like the Nifty IT Index Fund, and a thematic fund, like the Motilal S&P 500 Fund, adds diversity. However, these funds can be volatile as they are concentrated in specific sectors or themes.

Commodity-Based Fund
Your portfolio includes the Nippon India Silver ETF Fund of Funds (FOF). Commodity-based funds can provide diversification, but they can be volatile and are influenced by market demand and global trends.

Portfolio Overlap and Concentration
While your portfolio is diversified, it is essential to assess the overlap. Multiple funds investing in similar sectors or companies can lead to redundancy.

Disadvantages of Index Funds and ETFs
Index funds and ETFs track a specific index and replicate its performance. They cannot outperform the market since they lack active management.

Actively managed funds, on the other hand, aim to beat the market through strategic decisions and dynamic adjustments.

Benefits of Actively Managed Funds
Actively managed funds have experienced managers who strive to outperform the market. They can adjust the portfolio based on market conditions and select high-potential stocks, offering better returns.

Assessing the Need for Rebalancing
Given your portfolio, it may be beneficial to rebalance for optimal performance. Here are some suggestions:

Reduce Overlap: Consider reducing the number of large cap funds to avoid redundancy.

Focus on Quality Funds: Ensure the funds you invest in have a consistent performance record and a good management team.

Reevaluate Sector/Thematic Funds: Assess if the sector and thematic funds align with your risk tolerance and investment goals.

Regular Monitoring and Review
Regularly review your portfolio to ensure it aligns with your financial goals. Market conditions change, and periodic adjustments are necessary.

Consulting a Certified Financial Planner (CFP) can provide professional advice tailored to your needs. A CFP can help you select suitable funds, monitor performance, and make necessary adjustments.

Conclusion
Your diversified SIP portfolio shows a thoughtful approach towards long-term wealth creation. With some adjustments and regular reviews, you can enhance your portfolio's performance.

Focus on reducing overlap, prioritising actively managed funds, and aligning your investments with your financial goals. Keep up the good work and continue your disciplined investing.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

..Read more

Latest Questions
Ramalingam

Ramalingam Kalirajan  |7921 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Feb 10, 2025

Asked by Anonymous - Feb 08, 2025Hindi
Listen
Money
Hi, We will be having 15 Lakhs in hand by April 3rd week and can hold for next 3 years as we are planning to build a house at a tier 2 city - Coimbatore because I don't believe in flats system for a longer run as I am skeptical on the Uds and re-construction in the future. Also, monthly we can invest 15k in mutual funds and 80k for which we have decided to go for RD (conservative approach). Some of the apps are providing attractive offers to get higher FD returns from small finance banks (Ujjivan and North East Sf bank etc) , should we invest or to stick with HDFC and ICICI banks. Provide us a mix of plan (debt, equity and FD if possible) for 15 lacs and time horizon is 3 years. Thanks for your help!
Ans: Your approach is well thought out. You have a clear goal and a conservative mindset for short-term funds. Since the time frame is only three years, capital protection is the priority. Equity is not recommended for short durations due to volatility. A balanced mix of debt, FD, and liquid instruments will be suitable.

Allocation Strategy
Fixed Deposits (FDs) – 50% (Rs. 7.5 Lakhs)

Large banks like HDFC, ICICI, and SBI are safer for significant amounts.

Small finance banks offer higher interest, but risk levels are slightly higher.

Consider splitting FD amounts across large banks and reputed small finance banks.

Prefer banks with high credit ratings and check premature withdrawal terms.

Debt Mutual Funds – 30% (Rs. 4.5 Lakhs)

Choose high-quality short-duration funds with low credit risk.

Avoid long-duration debt funds as they are sensitive to interest rate changes.

Ensure the fund has a stable past record and consistent returns.

Ultra Short-Term/Liquid Funds – 20% (Rs. 3 Lakhs)

Suitable for flexibility and better returns than savings accounts.
Provides liquidity in case of urgent requirements.
Low risk compared to other debt instruments.
Monthly Investment Plan
Recurring Deposit (RD) – Rs. 80,000 per month

A conservative option ensuring stability.

Good for funds that need to be available within 3 years.

Choose banks offering competitive interest rates.

Mutual Fund SIP – Rs. 15,000 per month

Prefer actively managed equity funds for long-term wealth creation.
Avoid index funds due to lack of active risk management.
Opt for a mix of flexi-cap and mid-cap funds.
Small Finance Banks vs Large Banks
Small finance banks like Ujjivan and North East offer higher FD rates.
They are safe under Rs. 5 lakh due to DICGC insurance.
If investing above Rs. 5 lakh in such banks, evaluate their financial health.
For higher safety, prefer top private and PSU banks.
Tax Considerations
Interest from FDs and RDs is taxable as per your income slab.
Debt fund gains are taxed based on your income slab.
Plan withdrawals strategically to reduce tax burden.
Finally
Capital protection should be the priority for short-term funds.
Diversify into FDs, debt funds, and liquid funds.
Invest in small finance banks cautiously.
Continue SIPs for long-term wealth creation.
Best Regards,

K. Ramalingam, MBA, CFP

Chief Financial Planner

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

...Read more

Pushpa

Pushpa R  |51 Answers  |Ask -

Yoga, Mindfulness Expert - Answered on Feb 10, 2025

Asked by Anonymous - Feb 08, 2025Hindi
Listen
Health
सर मेरी शादी को 7साल हो गई है शुरू से ही हमारा रिलेशन खराब चल रहा है। आए दिन लड़ाई गली गलौज होती है। 2 बच्चे भी है। सेक्स लाइफ लगभग खत्म हो गई है। मैं क्या दूसरी लड़की के साथ बिना शादी के रह सकता हु।
Ans: I understand that you are going through a difficult time in your marriage. Relationships have ups and downs, and long-term conflicts can create emotional distress. However, before making any major decisions, I encourage you to reflect deeply on the situation.

Things to Consider:
Communication is Key – Have you tried open and honest communication with your spouse? Sometimes, expressing feelings calmly can help in resolving misunderstandings.
Professional Help – Marriage counseling or relationship therapy can provide guidance and help both partners understand each other better.
Impact on Children – Your children observe and absorb the environment at home. A peaceful and respectful atmosphere will shape their emotional well-being.
Seeking Happiness Outside Marriage – Instead of looking for temporary relief outside the marriage, try to work on improving the current relationship. If separation feels necessary, it should be done with mutual understanding and respect.
What Can You Do?

Practice meditation to calm your mind and gain clarity.
Talk to a relationship counselor or a trusted guide.
Try couple’s yoga or activities that promote bonding.
Every problem has a solution if approached with patience and wisdom. Stay mindful and take decisions that bring long-term peace and happiness.

R. Pushpa, M.Sc (Yoga)
Online Yoga & Meditation Coach
Radiant YogaVibes
https://www.instagram.com/pushpa_radiantyogavibes/

...Read more

Ramalingam

Ramalingam Kalirajan  |7921 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Feb 10, 2025

Listen
Money
Hi, I m a 37 year old professional. I want to save for a corpus of 5 Cr in next 15-20 Years. I am presently invested in equity and LIC. What should I change pls advice. 6.5 lakhs already invested in 15 stocks Indus ind, IDFC first, Yes bank, GMM f, orient cem, Niacl, DB Realty, Athenaglo, sail, Hcc, Bombay dyeing, DCAL, Ovi eke foods, igl, EaseMyTrip, somatex, Bajaj hind sugar. Also have 14 lakhs in LIC ULIP AND 1.5 lakhs in ICICI SIGNATURE PLAN AND 1 lakh in DSP NIFTY madcap 150 quality 50 Kindly advise. Currently investing 25k per month, planning to do a step up 10% sip every year.
Ans: You are on the right track, but some changes will improve your wealth creation strategy.

Here’s a step-by-step approach to help you achieve your Rs. 5 crore target in 15-20 years.

Equity Portfolio Assessment
You have Rs. 6.5 lakh in 15 stocks. This is a highly scattered portfolio.

Many of your stocks are small-cap and volatile. Some lack strong financials or growth potential.

Too many stocks reduce focus and make it difficult to track performance.

Reduce the number of stocks to 8-10 strong businesses with consistent growth.

Focus more on large-cap and quality mid-cap companies.

Exit weak, low-growth, or speculative stocks and reinvest in quality businesses.

Mutual Fund Investments
Your current SIP of Rs. 25,000 is a good start.

A step-up SIP of 10% yearly will help you reach your goal faster.

However, your only mutual fund holding is a DSP Nifty Midcap 150 Index Fund.

Index funds do not outperform in all market cycles.

Actively managed mutual funds give better flexibility and higher returns in long-term investing.

Shift to a well-diversified mix of actively managed large-cap, mid-cap, small-cap, and flexi-cap funds.

Invest in 3-4 high-quality mutual funds with experienced fund managers.

This will help in better risk-adjusted returns than a single midcap index fund.

LIC and ULIP Investments
You have Rs. 14 lakh in LIC ULIP and Rs. 1.5 lakh in ICICI Signature Plan.

Investment-cum-insurance products like ULIPs have high charges and low returns.

The annual cost and fund management fees eat into returns.

Consider surrendering these policies and reinvesting in mutual funds for better growth.

Use pure term insurance instead of investment-linked insurance plans.

SIP Step-up Strategy
Your step-up plan of 10% yearly is a good strategy.

Ensure discipline in increasing the SIP each year.

Automate your SIPs to avoid missing any investments.

If you get any bonus or extra income, invest that in lump sum for faster corpus growth.

Debt Allocation for Stability
A 100% equity portfolio is risky, especially as your corpus grows.

Slowly add debt investments like short-term bonds, SDLs, or target maturity funds after 10 years.

A small allocation (10-20%) will help reduce volatility closer to your goal year.

Tax Efficiency and Withdrawal Planning
Long-term capital gains (LTCG) above Rs. 1.25 lakh are taxed at 12.5%.

Short-term gains (STCG) are taxed at 20%.

Plan redemptions smartly to minimise tax impact.

Use SWP (Systematic Withdrawal Plan) post-retirement for tax-efficient withdrawals.

Final Insights
Reduce your direct stock holdings and focus on quality businesses.

Move from index funds to actively managed mutual funds for better returns.

Surrender low-return ULIPs and reinvest in equity mutual funds.

Stick to your step-up SIP strategy for compounding benefits.

Add some debt allocation in later years for portfolio stability.

Review and rebalance your portfolio every year.

Following this disciplined approach will help you reach your Rs. 5 crore goal efficiently.

Best Regards,

K. Ramalingam, MBA, CFP

Chief Financial Planner

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

...Read more

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.

Close  

You haven't logged in yet. To ask a question, Please Log in below
Login

A verification OTP will be sent to this
Mobile Number / Email

Enter OTP
A 6 digit code has been sent to

Resend OTP in120seconds

Dear User, You have not registered yet. Please register by filling the fields below to get expert answers from our Gurus
Sign up

By signing up, you agree to our
Terms & Conditions and Privacy Policy

Already have an account?

Enter OTP
A 6 digit code has been sent to Mobile

Resend OTP in120seconds

x