My investment is in 1. Quant small cap fund direct plan growth, 2. SBI Magnum mid cap direct plan growth, 3. SBI Bluechip direct plan growth, 4. ICICI PRUDENTIAL bluechip fund and 5. Axis bluechip fund. My monthly investment is 2500 rs/month, Please suggest if any changes needed.

Ans: Hello Vinit. Your selected portfolio is well diversified and looks good. If you wish to build corpus of 1 Cr in next 7years, I would suggest to add-on with your current sip investments to 75 k to achieve your goal or you can add on some funds annually to reach to sip investments of 75 k. Also, I would recommend to add flexicap categories in your portfolio.

Ans: investing Rs. 41,000 monthly is a great sign of discipline! It seems you're investing in several mutual funds, but let's see how we can optimize your portfolio.

Current Portfolio Analysis:

Number of Funds: Having 11 funds might be too many to manage effectively. It can be difficult to track performance and make adjustments.

Overlap: There might be overlap between some funds in terms of the stocks they invest in. This reduces diversification benefits.

Investment Strategy: Your portfolio has a mix of fund categories (Large & Mid Cap, Balanced Advantage, Sectoral, etc.). It's good, but we can improve it for your goals.

Here's why I can't give specific advice on your funds:

Performance: Past performance isn't a guarantee of future results. What did well yesterday might not do well tomorrow.

Your Goals: I don't know your investment goals (retirement, child's education, etc.) These influence the best investment choices.

Here are some suggestions to improve your portfolio:

Reduce the number of funds: Aim for 4-5 well-diversified funds across different market capitalizations (Large, Mid, and Small Cap).

Consider Asset Allocation: Decide on a strategic asset allocation based on your risk tolerance and goals. This helps you pick the right mix of asset classes (equity, debt).

Actively Managed Funds: Actively managed funds, where experienced professionals make investment decisions, can potentially outperform the market. Consider consulting a Certified Financial Planner (CFP) to help you choose these funds.

Benefits of a Regular Plan with a CFP:

Guidance: A CFP can analyze your financial situation and recommend a suitable investment strategy.

Portfolio Monitoring: They can help you track your investments and make adjustments as needed.

Goal Planning: They can help you set realistic financial goals and choose investments to achieve them.

Regular plans with a CFP might have slightly higher fees than direct plans, but the guidance can be valuable, especially for new investors.

Here are some additional thoughts:

Review Regularly: Meet with your CFP periodically to review your portfolio and adjust it as your life and goals evolve.

Stay Invested: Don't panic and redeem your investments during market downturns. A long-term view is important for building wealth.

By streamlining your portfolio, seeking professional help, and staying invested, you can increase your chances of achieving your financial goals.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

Ans: so many schemes will not help you achieve any diversification
kindly stop and redeem some funds and the schemes that you can continue are mirae emerging kotak emerging axis mid and nippon small hdfc index fund and icici bluechip

Ans: Assuming that you have equal investments in all the five funds, then 60% of your investments are in one AMC which is a new one with not much of a track record. This is a big risk that you are taking by concentrating so much in one AMC. There are two more aspects of this risk:-
1. Quant works largely on momentum created by ‘quant’ factors which is a very risky strategy and I do not know whether it will be good for a long-term portfolio as it is a new way of managing entire funds.
2. I can also see that, because Quant funds have performed well in the near past, you have filled your portfolio with it. This too is risky since your portfolio will grow not based on pats returns but future ones. You need to do much more study for making a robust portfolio.

Last point is about the overall risk of your portfolio. Your 100% of the portfolio is of quant strategy funds and small-and-mid cap funds. Be very sure that you want your portfolio to take such a high risk.

Ans: It's great to see your commitment to investing and building wealth for your future financial goals. You've diversified your portfolio across various mutual funds and ETFs, which is a smart move to spread risk effectively.

Diversification Strategy:

Diversifying your investments across different asset classes and fund categories is essential for mitigating risk and maximizing returns over the long term. By investing in flexi cap, value discovery, midcap, smallcap, and international funds, you're tapping into different market segments and investment opportunities.

Active vs. Passive Management:

While you've included both actively managed mutual funds and index funds (ETFs) in your portfolio, it's important to understand the differences between the two. Actively managed funds aim to outperform the market through active stock selection and portfolio management, while index funds passively track a specific index's performance.

Benefits of Actively Managed Funds:

Actively managed funds offer the potential for higher returns compared to index funds, especially during market inefficiencies or when skilled fund managers can identify lucrative investment opportunities. Additionally, active management allows for flexibility in portfolio construction and adjustments based on market conditions.

Potential Disadvantages of Index Funds:

While index funds offer low expense ratios and broad market exposure, they may lack the potential for outperformance compared to actively managed funds. Additionally, they're subject to tracking error, which occurs when the fund's performance deviates from the index it's designed to replicate.

Regular Funds Investing through MFD with CFP Credential:

Investing in regular funds through a Certified Financial Planner who acts as a Mutual Fund Distributor (MFD) offers several benefits. Your CFP can provide personalized guidance, portfolio monitoring, and ongoing support tailored to your financial goals and risk tolerance. They can also offer access to research and market insights to help you make informed investment decisions.

Review and Rebalance:

Regularly reviewing and rebalancing your investment portfolio is essential to ensure it remains aligned with your financial goals and risk tolerance. As market conditions change, some funds may outperform while others may underperform, necessitating adjustments to maintain the desired asset allocation.

Stay Informed and Engaged:

Lastly, stay informed about market trends and economic developments that may impact your investments. Continue to educate yourself about different investment options and strategies, and don't hesitate to reach out to your Certified Financial Planner for guidance whenever needed.

By staying disciplined, diversified, and informed, you're on the right track towards achieving your financial objectives. Keep up the excellent work, and feel free to reach out if you have any further questions or need assistance along the way. Happy investing!