Hello.
Please review my portfolio
Age: 27+
Portfolio age : 5yrs+
Mirae asset tax saver 4500
Tata ELSS 3000
Parag parikh flexi cap 3000
Mirae asset lage & mid cap : 2000
Sbi small cap 6500
Axis small cap 3000
Also I'm doing step-up SIP in the above funds .
P
Ans: Good Morning,
You have built a commendable and diversified investment portfolio at a young age. This proactive approach to investing sets a solid foundation for your future financial goals. Let’s review and assess your portfolio to ensure it aligns with your objectives.
Overview of Your Portfolio
Your portfolio includes a mix of tax-saving funds, large-cap, mid-cap, and small-cap funds, which is a balanced approach to long-term wealth creation. Here is a summary of your investments:
Mirae Asset Tax Saver: 4,500 rupees
Tata ELSS: 3,000 rupees
Parag Parikh Flexi Cap: 3,000 rupees
Mirae Asset Large & Mid Cap: 2,000 rupees
SBI Small Cap: 6,500 rupees
Axis Small Cap: 3,000 rupees
You are also doing step-up SIPs, which is an excellent strategy for increasing your investment amount over time and leveraging the power of compounding.
Assessment and Recommendations
Strengths of Your Portfolio
Diverse Fund Selection:
Your portfolio includes ELSS funds, which offer tax benefits under Section 80C.
The mix of large-cap, mid-cap, and small-cap funds provides balanced exposure across different market capitalizations.
Flexi-cap funds like Parag Parikh Flexi Cap offer flexibility to move across market caps based on market conditions.
Step-up SIPs:
Increasing your SIP amount periodically helps in combating inflation and increasing your investment corpus over time.
Areas for Improvement
Overweight in Small Caps:
You have significant exposure to small-cap funds (SBI Small Cap and Axis Small Cap). Small-cap funds can be highly volatile and risky, especially during market downturns.
Consider reducing exposure to small caps slightly to mitigate risk. Reallocate these funds to more stable large-cap or balanced funds.
ELSS Funds Allocation:
Your investment in ELSS funds (Mirae Asset Tax Saver and Tata ELSS) is good for tax saving, but ensure it aligns with your tax-saving needs.
Evaluate if the current allocation meets your Section 80C limit and adjust if necessary.
Review Fund Performance:
Regularly review the performance of each fund in your portfolio. While you have chosen reputable funds, market dynamics change, and fund performance can vary.
If any fund consistently underperforms, consider replacing it with a better-performing alternative.
Portfolio Rebalancing:
Periodically rebalance your portfolio to maintain the desired asset allocation. This ensures that your investment strategy stays aligned with your financial goals and risk tolerance.
Suggested Adjustments
Increase Allocation to Large-Cap and Balanced Funds:
Consider increasing your investment in large-cap or balanced funds. These funds tend to be more stable and less volatile compared to small-cap funds.
Maintain Diversification:
Continue diversifying across different fund types and market capitalizations to spread risk and maximize potential returns.
Monitor and Adjust Step-up SIPs:
Keep increasing your SIP amounts regularly. Ensure that the increments are sustainable and align with your income growth.
Long-Term Strategy
Stay Invested for the Long Term:
Continue your disciplined investment approach. Staying invested for the long term will help you ride out market volatility and benefit from compounding.
Regular Reviews with a Certified Financial Planner (CFP):
Schedule regular reviews with a CFP to ensure your portfolio remains aligned with your financial goals. A CFP can provide tailored advice and adjustments based on market conditions and personal circumstances.
Emergency Fund and Insurance:
Ensure you have an adequate emergency fund and proper insurance coverage. This will protect your investments from being liquidated during emergencies.
Conclusion
Your portfolio is well-diversified and positioned for growth. By making minor adjustments, increasing stability, and regularly reviewing your investments, you can continue to build wealth effectively.
Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in
Question by abhishek on May 14, 2021Hindi
