Long-term investor with crores invested seeking advice on single account or Upstox/Kotak Neo

Ans: Please continue

Ans: Considering your current holdings in international REIT and global innovation funds, if you're looking to diversify or reallocate, exploring flexible or diversified equity funds from various fund houses could be beneficial. Reassess your portfolio's overall asset allocation, risk tolerance, and investment goals before making any changes. A Certified Financial Planner (CFP) can provide personalized advice, assess suitable options from different fund houses, and guide you on whether to hold or reallocate based on your financial objectives and risk profile.

Ans: It's evident that you've taken a proactive approach towards investing, with a diverse portfolio across various Mutual Funds (MFs). Let's assess your current investments and provide guidance on your future investment strategy.

Your portfolio reflects a mix of flexi-cap, large-cap, mid-cap, and small-cap funds, indicating a balanced approach to risk and return. Investing with a horizon of 5 to 10 years aligns with your long-term financial goals, offering the potential for capital appreciation over time.

Adding a monthly investment of Rs 25,000 further strengthens your commitment to wealth accumulation and provides an opportunity to benefit from rupee-cost averaging, especially during market fluctuations.

However, it's essential to review your portfolio periodically to ensure alignment with your financial objectives and risk tolerance. Consider the following suggestions:

Diversification: While diversification is essential, having multiple funds within the same category may lead to overlap and concentration risk. Evaluate if certain funds serve similar purposes and consider consolidating or reallocating accordingly.

Review Performance: Regularly monitor the performance of your MFs and compare them against their benchmarks and peers. Funds that consistently underperform may warrant reconsideration.

Asset Allocation: Assess your asset allocation to ensure it aligns with your risk profile and investment horizon. Depending on your age and risk tolerance, you may consider adjusting the allocation between equity and debt funds.

Stay Informed: Keep yourself updated on market trends, economic indicators, and fund manager changes. This knowledge will empower you to make informed investment decisions.

Seek Professional Advice: Consider consulting with a Certified Financial Planner to review your portfolio comprehensively. They can provide personalized advice tailored to your financial goals and help optimize your investment strategy.

Overall, your commitment to long-term investing and systematic additions to your portfolio are commendable. With regular monitoring and adjustments, you're well-positioned to achieve your financial aspirations.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

Ans: Current Financial Situation and Loan Repayment Strategy

You are turning 36 this December and have an outstanding home loan of Rs. 33 lakhs with an EMI of Rs. 31,648 per month. Initially, you planned to pay Rs. 10 lakhs annually to close it in 3-4 years. Now, you are considering building a corpus of Rs. 50 lakhs in the next 4-5 years and closing it in one go.

Commendable Investment Approach

Your current investments show a disciplined and diversified approach:

Small Cap Direct Growth Funds: Rs. 11K each/month (9 months old)
ELSS Tax Saver Funds:
Parag Parikh: Rs. 2K/month (12 months old)
Mirae Asset: Rs. 1.5K/month (12 months old)
Quant: Rs. 3K/month (16 months old)
Kotak: Rs. 2K/month (16 months old)
PSU Equity Funds:
SBI: Rs. 3K/month (1 month old)
Aditya Birla Sunlife: Rs. 5K/month (1 month old)
Direct Stocks: Rs. 50K/month
Analysis of Current Investments

Your portfolio is well-diversified across small cap, ELSS, and PSU equity funds. Investing in direct stocks further adds to this diversity. Your approach balances risk and growth potential, and the tax-saving investments are necessary for you and your wife.

Advantages of Building a Corpus

Building a corpus of Rs. 50 lakhs before closing your loan has several benefits:

Liquidity Maintenance: Keeping funds accessible rather than locking them into prepayment allows for better liquidity management.

Potential Higher Returns: Your current investments are yielding good returns, which might be higher than the interest savings from prepaying the loan.

Disadvantages of Index Funds

Index funds only replicate market performance and do not aim to outperform. Actively managed funds can potentially deliver better returns through strategic decisions made by fund managers.

Benefits of Actively Managed Funds

Actively managed funds are handled by expert fund managers who can adapt to market changes. This adaptability can lead to higher returns and better risk management compared to index funds.

Disadvantages of Direct Funds

Direct funds lack professional guidance and management. Investing through regular funds with a Certified Financial Planner (CFP) provides expert advice and regular portfolio reviews, optimizing your investments.

Evaluating Your Loan Prepayment Strategy

Your plan to pay Rs. 10 lakhs annually from your investments is sound, but consider the following:

Interest Rate Comparison: Compare the potential returns from your investments with the interest rate on your home loan. If investment returns exceed loan interest, continuing your current investment strategy might be better.

Tax Benefits: Home loan interest payments provide tax deductions. Weigh the tax benefits against the interest paid before deciding on prepayment.

Suggested Investment Adjustments

To optimize your portfolio, consider these adjustments:

Flexi Cap Funds: These funds provide flexibility by investing across market capitalizations, balancing risk and return.

International Equity Funds: Diversifying globally can hedge against domestic market volatility and tap into global growth opportunities.

Sectoral/Thematic Funds: Investing in specific sectors like technology or healthcare can offer high growth potential but comes with higher risk.

Regular Monitoring and Professional Guidance

Periodic reviews with a Certified Financial Planner are essential. They help align your investments with changing market conditions and personal goals, ensuring you stay on track for your financial targets.

Conclusion

Your current strategy and disciplined approach are commendable. Building a Rs. 50 lakh corpus before closing your home loan seems wise, given the potential for higher returns from your investments. Regular reviews and professional guidance will help optimize your portfolio and achieve your financial goals.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

Ans: Hi Rahul,

Good to see your dedication towards investments. Although the overall amount and potential to increase investments in good. But the funds selection is average.
Invest 8k in a largecap fund,7k in midcap, 5k in small cap, 5k in multicap and 5k in Baf. Avoid investing in current funds.

You can choose to consult an advisor to get exact fund names. Or can consult a professional Certified Financial Planner - a CFP who can guide you with exact funds to invest in keeping in mind your age, requirements, financial goals and risk profile.

Let me know if you need more help.

Best Regards,
Reetika Sharma, Certified Financial Planner
https://www.instagram.com/cfpreetika/