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Ramalingam Kalirajan |10881 Answers |Ask -Follow

Mutual Funds, Financial Planning Expert - Answered on Apr 04, 2024

Ramalingam Kalirajan has over 23 years of experience in mutual funds and financial planning.
He has an MBA in finance from the University of Madras and is a certified financial planner.
He is the director and chief financial planner at Holistic Investment, a Chennai-based firm that offers financial planning and wealth management advice.... more

Question by jayakumar on Jan 04, 2024Hindi

Hi Sir, I am planning for long term savings through mutual funds and invested in below sectors.Please suggest if these are fine are any changes to be made. 1) Axis small cap fund direct growth -1500 2) Nippon india small cap fund direct growth-2000 3) kotak emerging equity fund direct growth- 500 4) motilal oswal nifty 500 index fund direct growth - 500 5) edelweiss small cap fund direct growth- 1000 6) HDFC small cap fund direct growth - 1000 7) quant mid cap fund Direct growth - 1000 8)SBI bluechip direct plan growth - 2000 9) tata small cap fund growth - 500 10) icici prudential bluechip fund growth - 2500

Ans: It appears that you have a diversified portfolio with exposure to various segments of the market, including small-cap, mid-cap, large-cap, and index funds. However, having too many funds can sometimes lead to over-diversification and dilution of returns.

Here are a few suggestions:

Consolidate: Consider consolidating your holdings to fewer funds to simplify your portfolio and reduce overlap. You could achieve diversification with fewer funds by selecting multi-cap or flexi-cap funds that invest across market capitalizations.

Review Performance: Evaluate the performance of each fund relative to its benchmark and peers. If any fund consistently underperforms or fails to meet your expectations, consider replacing it with a better-performing alternative.

Assess Risk: Ensure that your portfolio aligns with your risk tolerance and investment objectives. Small-cap and mid-cap funds tend to be more volatile than large-cap funds, so make sure you're comfortable with the level of risk in your portfolio.

Consider Goals: If you have specific financial goals, such as retirement or education planning, tailor your investments accordingly. Allocate more towards funds that align with your long-term objectives.

Stay Informed: Stay updated on market developments and periodically review your portfolio to make necessary adjustments based on changing market conditions or personal circumstances.

Ultimately, the suitability of your portfolio depends on factors such as your risk tolerance, investment horizon, and financial goals. Consider consulting with a financial advisor who can provide personalized advice based on your individual situation and objectives.

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