I am investing via SIP in UTI FLEXICAP FUND since last 7 years. But since last 2-3 years the fund is under performing. What should I do

Ans: Please continue with Mirae and Axis Large cap funds and may include Uti Equity Fund-growth Plan-growth and / OR Parag Parikh Long Term Equity Fund- Regular Plan Growth

Portfolio Review:

Once the funds and categories are identified and investment is made thereafter it becomes very important to periodically review the portfolio.

The frequency at which investments can be review in 6 months to a years' time depending upon the objective, tenure and the risk profile. 

Few of the parameters that can be used when to review in between are as under.

1) Material change in the category of the fund due to regulatory requirement i.e. at present multi cap funds

2) Major events i.e. corporate tax rate cut that happened last year on 23^rd September 2019, few industries / sectors had more benefit, few may have not; similarly, Covid 19 impacts (not panic part)

3) If all remains normal, then look at the portfolio churn ratio; lower ratio means the fund portfolio will change slowly and therefore the review can be once a year; however it the ratio is very high then constant review is required i.e. in 3 months.

4) If there is substantial underperformance vis-a-vis category as well as benchmark for couple of quarter, fund needs review

5) If there are certain realignment required in the set objectives / goals or change in risk profile considering dynamic nature of live.

Ans: Your current investments in Parag Parikh Flexi Cap Fund and Quant Flexi Cap Fund show a preference for flexible allocation across market caps, which is a prudent approach for diversification. However, it's essential to periodically review your portfolio's performance and ensure alignment with your investment goals and risk tolerance. Consider evaluating funds across various categories such as large-cap, mid-cap, and small-cap to achieve greater diversification. Consulting with a financial advisor can provide personalized insights into potential adjustments or additions to your portfolio based on changing market conditions and your long-term objectives.

Ans: When faced with underperformance in an investment like UTI Flexicap, it's essential to assess your options carefully. Here's a suggested approach:

Review Performance: Evaluate the fund's performance relative to its benchmark and peer group over various time frames. Consider factors like consistency, volatility, and risk-adjusted returns.
Understand Reasons: Research and understand the reasons behind the fund's underperformance. Assess changes in fund management, investment strategy, sectoral exposures, or market conditions that may have contributed to the performance lag.
Assess Your Portfolio: Consider how UTI Flexicap fits into your overall investment portfolio. Evaluate its role in diversification, risk management, and alignment with your financial goals and risk tolerance.
Consult with a Certified Financial Planner: Seek advice from a professional who can provide personalized guidance based on your individual circumstances. A Certified Financial Planner can help you assess whether to continue SIPs in UTI Flexicap or consider alternative options.
Explore Alternatives: Research other mutual funds in the flexicap category that have demonstrated consistent performance and align with your investment objectives. Compare their track records, investment philosophies, and expense ratios before making a decision.
Monitor Regularly: Regardless of your decision, continue to monitor the performance of your investments regularly. Stay informed about market trends, fund developments, and changes in your financial situation that may warrant adjustments to your investment strategy.
Ultimately, the decision to continue or stop SIPs in UTI Flexicap depends on your assessment of its performance, your investment goals, and your risk tolerance. With careful consideration and professional guidance, you can make informed choices to optimize your investment portfolio.

Ans: When faced with underperforming investments like UTI Flexicap Fund, it's essential to evaluate your options carefully. Here are some steps you can consider:

Review Performance: Assess the fund's performance objectively over different time periods and compare it with its benchmark and peer funds. Look for consistent underperformance or temporary setbacks.
Understand Reasons for Underperformance: Research and understand the reasons behind the fund's underperformance. Is it due to changes in fund management, investment strategy, market conditions, or specific sectoral exposures?
Reassess Investment Thesis: Revisit your original investment thesis for choosing UTI Flexicap Fund. Does it still align with your financial goals, risk tolerance, and investment horizon? Consider whether the fund's underperformance is a temporary setback or a fundamental issue.
Seek Professional Advice: Consult with a Certified Financial Planner or investment advisor for personalized guidance. They can provide insights into whether it's prudent to hold onto the investment, reallocate funds to better-performing options, or exit the investment altogether.
Consider Portfolio Diversification: If UTI Flexicap Fund no longer fits your investment strategy, explore reallocating your investment to other funds or asset classes that better align with your goals and risk profile.
Patience vs. Action: Determine whether you're willing to wait for the fund's performance to improve or if you prefer to take proactive steps to address the underperformance.
Ultimately, the decision to withdraw or wait depends on your individual circumstances, investment objectives, and risk tolerance. It's essential to make informed decisions based on thorough research and professional advice.