Request your advise on the following

My current portfolio is 

Reliance-70% - Hold

Balance-30% in the below scripts

All these I entered in last 2 months. 

I want to invest more in equity and my plan is to have all future investments in Reliance which I feel will give Better returns in long run.

I am looking at minimum of 5 years horizon. 

Ans: The funds are decent; however, there are too many funds in large cap; these can be consolidated

Ans: You have a total of Rs 11,500 of SIPs per month. You will easily reach your target of Rs 50 Lakhs even in 15 years with the portfolio you are following, even after not taking into account the amount you have accumulated in the past 5 years!
And magic will happen if you increase your SIP by 10% each year as your salary increases.

However, remember that your portfolio is very aggressive, 100% equity oriented and would need a review and if required, rebalancing once a year.

My recommendations on your funds:-

1. Axis Bluechip Fund – Large Cap – Continue
2. Axis Flexicap Fund – Flexi Cap – Poor performance. Switch to Parag Parikh Flexi Cap Fund
3. Kotak Emerging Equity Fund – Mid Cap - Continue
4. DSP Mid Cap Fund – Mid Cap – Poor performance. Switch to PGIM India Midcap Opp Fund
5. IDFC Emerging Business – Small Cap - A very new fund with hardly any track record. Switch instead to SBI Small Cap Fund
6. Axis Small Cap Fund – Small Cap – Continue

Ans: Hello Renuka. Considering all factors, Portfolio reports sounds good except Aditya Birla Sunlife AMC and Sundaram AMC. I would recommend to reconsider the same.

Ans: I appreciate your dedication to building a strong investment portfolio over the years. It is clear you have put considerable thought into your financial planning. Let’s assess your portfolio and the proposed changes. I’ll ensure the analysis is straightforward and tailored to your long-term goals.

Portfolio Evaluation
Your current portfolio includes a mix of large-cap, mid-cap, and small-cap funds. This diversified approach can be beneficial for long-term growth. Here's a detailed evaluation:

Flexi Cap Funds
You have Kotak Flexi Cap and plan to switch to Parag Parikh Flexi Cap. Flexi cap funds provide flexibility by investing across market capitalizations. This strategy helps in adapting to market changes. Parag Parikh Flexi Cap has a strong track record. However, before switching, consider if the new fund aligns with your risk tolerance and investment objectives.

Mid-Cap and Small-Cap Funds
Mid-cap and small-cap funds are more volatile but offer higher growth potential. Mirae Emerging Bluechip and Kotak Emerging Equity are robust mid-cap funds with good historical performance. Small-cap funds like Nippon India Small Cap and Canara Rob Small Cap are also included. It's wise to monitor their performance periodically and ensure they fit your risk profile.

Balanced Advantage Fund
The HDFC Balanced Advantage Fund provides a balanced exposure to equity and debt, reducing overall risk. This fund is suitable for moderate risk-takers seeking stability and growth.

Proposed Changes
Exiting Kotak Flexi Cap
Switching from Kotak Flexi Cap to Parag Parikh Flexi Cap is a strategic move. Parag Parikh Flexi Cap has shown consistent performance and a unique investment strategy. Ensure this fund complements your overall portfolio and aligns with your risk tolerance.

Small Cap Funds
You have two small-cap funds: Nippon India Small Cap and Canara Rob Small Cap. Small-cap funds are highly volatile and risky. Consolidating into one robust small-cap fund can reduce complexity and manage risk better. Quant Small Cap is known for its performance, so replacing Canara Rob with Quant could be a good decision.

Recommendations
Maintain a Diversified Portfolio
Diversification helps manage risk and enhance returns. Your current mix of flexi cap, mid-cap, and small-cap funds is well-diversified. Regularly review and rebalance your portfolio to stay aligned with your goals.

Regular Monitoring
Regular monitoring of your funds' performance is crucial. Assess the performance of each fund against its benchmark and peers. This ensures your investments continue to meet your expectations.

Risk Tolerance
Ensure your portfolio aligns with your risk tolerance. Mid-cap and small-cap funds are more volatile, so be prepared for market fluctuations. Balanced advantage funds can provide stability and reduce overall portfolio risk.

Long-Term Strategy
Consistent Investing
Your long-term horizon of 20-25 years is ideal for equity investments. Continue your systematic investment plans (SIPs) to benefit from rupee cost averaging and compounding.

Review Annually
Annual portfolio reviews with a Certified Financial Planner can ensure your investments are on track. Adjustments based on life changes, market conditions, and financial goals can optimize your portfolio.

Conclusion
Your portfolio is well-structured with a mix of funds. The proposed changes can enhance performance and align with your long-term goals. Regular monitoring, diversification, and alignment with risk tolerance are key to successful investing.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in