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Nikunj

Nikunj Saraf  | Answer  |Ask -

Mutual Funds Expert - Answered on Oct 28, 2022

Nikunj Saraf has more than five years of experience in financial markets and offers advice about mutual funds. He is vice president at Choice Wealth, a financial institution that offers broking, insurance, loans and government advisory services. Saraf, who is a member of the Institute Of Chartered Accountants of India, has a strong base in financial markets and wealth management.... more
Rajat Question by Rajat on Oct 28, 2022Hindi
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Hi Nikunj, I am investing in following MFs through SIPs

Kotak India eq contra

SBI magnum midcap

Axis small cap

My goal is to accumulate funds in 10 yrs down the line for my son’s education.

Out of the invested MF kotak is not performing well.

Please guide.

Thanking you in advance.

Ans: Hi Rajat. Regarding your question about Kotak schemes in your portfolio. The scheme is an average performer. You can reconsider it & switch to the same AMC in a different category. You can also reconsider with peer schemes in the same category.

I would suggest introducing schemes from Flexi cap and large cap categories as this category seem missing in your portfolio.

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.
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Ramalingam

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Mutual Funds, Financial Planning Expert - Answered on Apr 24, 2024

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I am 🥇 ng these mfs 1.Parag parekh multi cap average invesent per month 6 to 8k in last 8 months ,return 17percent 2. 360 focused equity growth siping rs 2500 since 1.5 years return 20 percent 3. Newly started since 2 months pgim small cap return 4 percent 4. Mirae Blue chip holding 500 units sipped for 2.5 years return 73 percent at present Please advise on the future action like hold or keep investing
Ans: Firstly, it's truly heartening to see your commitment to investing and the returns you've achieved reflect that dedication. You've navigated various market conditions, showcasing resilience and an ability to adapt, which is commendable.

Looking at your portfolio, you've embraced a mix of multi-cap, focused equity, small-cap, and blue-chip funds. Each has its unique characteristics and serves a purpose in a diversified portfolio.

As for your future actions, it's essential to reflect on your investment goals. Are you investing for a specific milestone or a long-term horizon? The returns you've achieved are commendable, but what's the story behind these numbers? Understanding the 'why' behind your investments can guide your future decisions.

For your existing funds, consider reviewing their performance against benchmarks and their alignment with your goals. For new investments, ponder on whether they align with your strategy or introduce a new dimension to your portfolio.

In this journey of financial growth, it's not just about numbers but also about aligning your investments with your aspirations and values. A Certified Financial Planner can provide a holistic perspective, ensuring your investments resonate with your life's broader narrative.

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Ramalingam

Ramalingam Kalirajan  |9863 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Nov 02, 2024

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I have started investing in MFs through SIPs just now from this month and have invested 9k in three different funds namely 1)bandhan nifty 50index fund 2k 2) sbi contra fund 5k and 3) sbi nifty next 50 index fund 2k , all these are constantly falling have I invested in right funds ??
Ans: Your commitment to investing through SIPs is truly a positive start. Starting early allows your investments time to grow, despite short-term market fluctuations. Let's assess your portfolio and look at ways to ensure it's aligned with your long-term goals.

1. Understanding the Nature of Index Funds in Your Portfolio
You've invested in two index funds: a large-cap and a mid-cap index fund. These funds replicate stock market indices and provide moderate growth at low costs. However, index funds come with certain limitations:

Lack of flexibility in performance: Index funds follow the market index strictly. They cannot adapt to changes in the economy or capture potential high-growth opportunities outside of the index.

Market-dependent returns: Index funds tend to mimic market performance. In bearish phases, their returns can remain low for extended periods.

Actively managed funds may outperform: Actively managed funds, guided by expert fund managers, can perform better during economic downturns and offer flexibility in stock selection.

Choosing a mix of active funds could add stability and potentially higher returns to your portfolio. This would allow you to manage risks better and capture returns that index funds may miss.

2. Advantages of Actively Managed Funds Over Index Funds
Your investments in index funds focus on replicating market returns. While index funds are simple and cost-effective, actively managed funds provide some distinct benefits:

Flexibility during market downturns: Active funds can adjust to changing market conditions, unlike index funds.

Higher growth potential: Fund managers actively select high-performing stocks, offering higher growth than standard indices.

Opportunities in mid and small caps: Actively managed mid-cap and small-cap funds can diversify your portfolio and aim for high-growth stocks not included in major indices.

Including actively managed funds could balance your portfolio, providing both growth and stability over time.

3. Role of Contra Funds in Diversifying Your Portfolio
Your portfolio includes a contra fund, which invests against market trends. Contra funds are unique but often misunderstood. Here’s what to consider:

Long-term potential: Contra funds might underperform during bullish phases but perform well during market corrections.

Riskier in the short term: These funds can experience sharp fluctuations. They need a longer horizon to show returns.

Balanced with active funds: Contra funds work well when paired with actively managed funds to add stability and increase growth chances.

If you prefer balanced returns, you might consider including funds that perform consistently across market cycles alongside your contra fund.

4. The Importance of Regular Funds with Certified Financial Planner Support
While you’ve invested in direct funds, it’s essential to consider the benefits of regular funds. Here’s why investing through a CFP adds value:

Tailored advice: A CFP offers tailored guidance, helping you select funds aligned with your risk tolerance and goals.

Proactive portfolio adjustments: Regular fund investments allow a CFP to actively monitor, rebalance, and adjust your portfolio based on market changes.

Enhanced portfolio growth: Advisory support enables you to explore options and strategies that could outperform simple index-based growth.

Investing in regular funds with CFP guidance ensures a hands-on approach, maximising your investments' potential and helping you achieve financial goals with ease.

5. Focus on Long-Term Potential Amid Market Volatility
As you mentioned, the market volatility might make your investments appear concerning. However, SIPs are designed to manage fluctuations and offer average cost benefits over time.

Ride out market lows: SIPs allow you to buy more units when markets are low, lowering your average purchase cost.

Compounding with time: Long-term investing enables the compounding effect, enhancing your overall returns.

Market cycles: The market operates in cycles. Investments that appear underperforming now may eventually provide robust returns as markets recover.

Patience and a long-term approach are essential in SIP investments, particularly during volatile phases. Staying invested is key to achieving the full growth potential.

6. Tax Considerations for Long-Term Gains
Being mindful of tax implications on your mutual fund investments is essential. The latest tax rules for capital gains include:

Equity mutual funds: Long-term gains above Rs 1.25 lakh attract a 12.5% tax, while short-term gains are taxed at 20%.

Debt funds: Both long-term and short-term gains are taxed based on your income slab.

Knowing these tax implications helps you plan better, as long-term investments benefit from favourable tax treatment.

7. Creating a Balanced and Diversified Portfolio
Balancing your portfolio ensures stable and consistent returns, especially when investing for the long term. Here’s a simple strategy:

Blend of equity and debt funds: Equity funds offer high growth, while debt funds add stability. Together, they balance risk and returns.

Mix of small, mid, and large caps: Each segment offers unique growth opportunities. Large caps provide stability, mid-caps offer growth, and small caps have high-growth potential.

Include hybrid funds: Hybrid funds offer a blend of equity and debt, providing both growth and safety, ideal for achieving long-term goals.

This diversified approach safeguards your investments from market volatility, ensuring you reach your financial goals.

8. Finally
Starting your SIP investments is a solid move, and with some fine-tuning, you can align it better with your goals. Consider introducing actively managed funds and possibly hybrid funds to balance the risks of index funds. By doing so, you open up more growth opportunities while safeguarding your portfolio against market downturns. Staying focused on your long-term strategy and reviewing your investments periodically with a CFP can help you make informed adjustments along the way.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

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

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Hi sir, I am in my 5th semester of B.pharm in India and want to do a master's abroad. I am confused between Germany, US, UK, Canada, Ireland and Australia. I come from a lower middle-class family so among all I can manage Germany but for that too I think I have to take education loan, not sure if it affects my visa approval. According to scope I am planning to do courses like regulatory affairs, bioinformatics, toxicology, life science informatics, biotechnology or drug development. I expect CGPA around 8 - 8.5 and credit points around 205-210 which are not equal to European credit points. Can I still get admission? Any advice on best course and country?
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1. Country-wise Advice (based on budget and goals):
• Germany:
Best fit for you — low to no tuition fees in public universities.
Good options in biotech, drug development, bioinformatics, and life sciences.
You'll need around ?9–10 lakhs in blocked account + basic living costs.
Education loan is fine and doesn’t affect visa negatively if paperwork is clear.
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You’ll likely need heavy loans and part-time work to manage.
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• CGPA of 8–8.5 is decent.
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Hi there So i got like 97k in kcet and 73k ranks in comedk i want cse mostly im fine with ece also in the first mock round of comedk i got sahayadri college of engineering is that good And also what colleges i might get in Bangalore with these ranks and want good placements or do you suggest me to go take management quota seat in nhce or jain rather than all this
Ans: With a KCET rank of 97,000 and COMEDK rank of 73,000, Computer Science or ECE seats in Bangalore’s most sought-after colleges (such as RVCE, BMSCE, MSRIT, PESU, and DSCE) are not attainable, as their cutoffs close far earlier. For these ranks, you are eligible for options like R.R. Institute of Technology, S.E.A. College of Engineering, M.S. Engineering College, Dr. H N National College of Engineering, City Engineering College, and East West Institute of Technology in Bangalore through COMEDK, as well as GSS Institute of Technology via KCET; CSE or ECE is typically offered until about 75,000–1,00,000 rank in these institutions. Sahyadri College of Engineering in Mangalore, offered in the first mock allotment, has a consistent placement record with an average package of ?3–4 lakh and top recruiters such as Microsoft and IMV Corporation, and regularly fills over 80% of its eligible CSE/ECE students; the infrastructure is modern and reviews cite good faculty engagement, but it is outside Bangalore. For NHCE and Jain University, you can take CSE/ECE through management quota; both campuses provide contemporary facilities, ABET/NAAC accreditations, and strong placement rates above 80%, but require a significant tuition premium (?10–12 lakh total fee). NHCE’s placement cell is robust, and Jain’s industry ties are well rated. Placement opportunities and exposure are typically stronger at NHCE/Jain due to their branded recruiter base and metropolitan location, provided affordability is not a concern.

Recommendation: If your priority is a Bangalore location, industrial exposure, and better placement prospects, opting for NHCE or Jain University CSE/ECE via management quota is advisable if the higher cost is manageable. Among merit seats, Sahyadri (Mangalore) is a solid backup, but in Bangalore, prefer institutes like NHCE and Jain for stronger campus recruitment, infrastructure, and networking. All the BEST for a Prosperous Future!

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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.

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