Request you to kindly review my portfolio and advise if I shall continue with the same.

I have been investing in mutual funds through SIP 50000 per month since Nov 2017.

Here is the list of funds I'm investing.

1.Kotak Standard Multicap Fund

2.L&T Emerging Businesses Fund.

3.Motilal Oswal Multicap 35 Fund.

4.HDFC Hybrid Equity Fund.

5.Principal Emerging Bluechip Fund.

>Recently I have stopped my SIPs in

1.L&T Emerging Businesses Fund.

2.Motilal Oswal Multicap 35 Fund.

And switched to:

1.Axis bluechip fund direct growth
2.DSP midcap direct growth

Please advise the fund selection and if I shall continue with the same.

Ans: Please continue

Ans: Your portfolio appears to be heavily concentrated with multiple funds, possibly leading to overlap and excessive diversification. It's essential to streamline your investments to avoid redundancy and maintain a clear investment strategy. Consider consolidating similar funds or those with overlapping objectives. Assess the performance, risk, and alignment with your financial goals for each fund. Periodic review and adjustments are crucial to ensure your portfolio remains aligned with your objectives and risk tolerance. Consulting a financial advisor can help you optimize your portfolio and ensure a more focused investment approach.

Ans: Your dedication to investing at such a young age is impressive and sets a strong foundation for your financial future. Let’s review your current portfolio and provide suggestions for optimization.

Portfolio Review
Diversification Across Funds
You have diversified across various categories, including flexi cap, large cap, balanced advantage, mid cap, and small cap funds. Diversification helps in spreading risk and capturing growth from different market segments.

Fund Categories and Allocation
Flexi Cap Funds: These funds offer flexibility to invest across market capitalizations. They balance risk and reward effectively.

Large Cap Funds: Large cap funds are stable and less volatile, providing consistent returns over time.

Balanced Advantage Funds: These funds dynamically manage equity and debt, offering a balanced approach to growth and stability.

Mid Cap Funds: Mid cap funds are riskier but can deliver higher returns than large cap funds. They offer growth potential.

Small Cap Funds: Small cap funds are the most volatile but can provide significant growth over the long term.

Recommendations for Portfolio Optimization
Assessing Risk and Returns
Your portfolio is well-diversified but leans towards higher risk with significant exposure to mid and small cap funds. At your age, a higher risk tolerance is understandable, but it’s crucial to maintain a balance.

Adjusting Fund Allocation
Increase Allocation to Large Cap and Balanced Advantage Funds: These funds provide stability and consistent returns. Increasing your investment in these funds can balance the risk from mid and small cap funds.

Review Flexi Cap Funds Allocation: You have a substantial allocation to flexi cap funds. Ensure these funds are performing well and meeting your investment goals.

Monitor Mid and Small Cap Funds: Keep an eye on the performance of mid and small cap funds. Consider reducing exposure if they are too volatile for your risk tolerance.

Regular vs. Direct Funds
Investing through regular funds with the help of a Certified Financial Planner ensures you receive expert guidance. This helps in making informed decisions and optimizing your investment strategy.

Long-Term Investment Strategy
Goals and Time Horizon
Identify your financial goals and time horizon. Long-term goals like retirement or buying a house can tolerate higher risks. Short-term goals require safer investments.

Systematic Investment Plan (SIP)
Continue with your SIPs to benefit from rupee cost averaging. This reduces the impact of market volatility and helps in disciplined investing.

Emergency Fund
Ensure you have an emergency fund covering 6-12 months of expenses. This provides financial security in case of unforeseen events.

Health and Life Insurance
Consider getting adequate health and life insurance coverage. This protects your investments and provides financial security to your family.

Conclusion
Your proactive approach to investing is excellent. By adjusting your fund allocation and maintaining a balanced risk profile, you can achieve your financial goals more effectively. Regular reviews and guidance from a Certified Financial Planner will ensure your investments stay on track.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

Ans: Your portfolio reflects diversity across categories. However, optimisation is needed to align with financial goals. Below is a detailed review:

SIPs in Actively Managed Regular Plans
1. ABSL Frontline Equity (Rs 1000)

Returns: 14.77% since 2014
Assessment: Decent long-term performer in large-cap space. Consider retaining this SIP for stability.
2. Bandhan Flexicap (Rs 2000)

Returns: 13.62% since 2014
Assessment: Performance consistent, but alternatives may offer better opportunities. Explore other flexicap funds with dynamic management.
3. Sundaram Midcap (Rs 1000)

Returns: 18.64% since 2014
Assessment: Impressive returns; retain for potential in midcap growth.
4. Sundaram Large & Midcap (Rs 2000)

Returns: 16.01% since 2014
Assessment: Balanced fund delivering good returns; recommend continuing.
5. ICICI Pru Bluechip (Rs 1000)

Returns: 16.65% since 2014
Assessment: Steady performer in large-cap category. Retain for portfolio stability.
6. Nippon India Smallcap (Rs 1000)

Returns: 33.31% since 2021
Assessment: High returns in a short time; small-cap investments suit higher risk tolerance. Consider continuing if goal aligns.
7. Tata Smallcap (Rs 1000)

Returns: 32.14% since 2021
Assessment: Small-cap volatility is high. Retain only if long-term horizon exceeds 7-10 years.
8. Axis Bluechip (Rs 1000)

Returns: 14.20% since 2021
Assessment: Underperforming in the large-cap category; better options are available.
SIPs in Direct Plans
9. Nippon India Smallcap (Rs 4000)

Returns: 36.09% since 2023
Assessment: Excellent short-term returns. Evaluate if overlapping with your existing small-cap holdings.
10. Quant Smallcap (Rs 8000)

Returns: 29.87% since 2023
Assessment: Volatility typical of small-cap funds; ensure no over-allocation to this segment.
11. Kotak Emerging Equity (Rs 5000)

Returns: 34.68% since 2023
Assessment: Promising returns; align with your risk and time horizon before continuing.
12. ICICI Focused Equity (Rs 2000)

Returns: 33.75% since 2023
Assessment: Focused equity funds bring concentration risks. Consider reducing allocation to balance risk.
13. ICICI Large & Midcap (Rs 2000)

Returns: 29.86% since 2023
Assessment: Diversified strategy suits mid-term goals. Consider holding for stability.
14. Quant Midcap (Rs 4000)

Returns: 23.39% since 2023
Assessment: Reasonable performance in a short period. Retain for midcap exposure.
Key Recommendations
Surrender Direct Funds: Direct plans lack the professional guidance of an MFD or CFP. Transition to regular plans to gain insights, periodic review, and holistic advice.

Consolidate Small-Cap Investments: You hold multiple small-cap funds. Retain 1-2 for high-risk, high-reward potential. Allocate surplus to other categories.

Replace Underperformers: Axis Bluechip and Bandhan Flexicap are candidates for reallocation. Replace them with actively managed funds showing stronger performance.

Ensure Category Allocation: Maintain a balanced allocation between large-cap, midcap, and small-cap funds.

Additional Insights
Tax Efficiency: Ensure tax planning aligns with your goals. For equity funds, LTCG above Rs 1.25 lakh attracts 12.5% tax. STCG is taxed at 20%.

Reassess Goals: Match fund selection to financial milestones like retirement, children’s education, or asset creation.

Review Regularly: A portfolio review every six months ensures alignment with financial goals and market conditions.

Final Insights
Your portfolio is diversified but needs fine-tuning. Transition to regular funds for professional guidance. Consolidate small-cap holdings to reduce overlap. Focus on long-term wealth creation through a balanced strategy.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,
www.holisticinvestment.in
https://www.youtube.com/@HolisticInvestment