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Omkeshwar

Omkeshwar Singh  | Answer  |Ask -

Head, Rank MF - Answered on Nov 02, 2022

Mutual Fund Expert... more
Mithun Question by Mithun on Nov 02, 2022Hindi
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I am running 3 index Mutual fund with total SIP of 25k, since late 2020. I want broad market coverage on M-caps at a much lower expense ratios should be below 50 paise.

I have existing balance fund and a flexi cap fund and started new SIP in following index funds.

Current SIPs:

1. HDFC NIFTY 50 - Direct growth - Rs 12,000 monthly SIP

2. Motilal Oswal Midcap 150 - Rs 6,000 monthly SIP

3. Motilal Oswal smallcap 250 - Rs 6000 monthly SIP

I want to change my SIP distribution. I want to have a higher contribution to MO mid cap 150, thus I am thinking of reducing SIPs in 

Nifty 50 by 2k, smallcap 250 by 2k, and adding to mid cap 150.

So new planned SIP distribution is thus:

1. HDFC NIFTY 50 - Direct growth – Rs 10,000 monthly SIP

2. Motilal Oswal Midcap 150 Rs 10,000 monthly SIP

3. Motilal Oswal smallcap 250 - Rs 5000 monthly SIP

Questions:

1. What is the ideal ratio for SIP distribution on basis of Market capitalisation, with an outlook of 10 years? 

Ans: 10 years is good time and hence mid and small caps can be with higher weightage

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

Ramalingam Kalirajan  |9790 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jun 13, 2025

Asked by Anonymous - Jun 13, 2025
Money
Hi Ramalingam, I am 26 and currently starting SIP 9 months ago . Nippon small cap -2k Quant small cap -3.3k Bandhan small cap - 2k Motilal Midcap - 2.5k Sbi long term equity - 2k Sbi psu - 50k lumpsum Could you please suggest portfolio allocation and if I want to increase my from 13300 to 40000
Ans: You are 26 years old and already doing SIPs. That shows your discipline and future readiness. Starting early builds wealth better over time. Investing Rs. 13,300 monthly and planning to raise it to Rs. 40,000 is smart. Let’s now look at your existing portfolio, assess the risks, and suggest a proper diversified structure.

We will offer a 360-degree solution that balances growth, stability, and future flexibility.

Your Current Portfolio Overview
Your current SIPs are in:

Nippon Small Cap Fund – Rs. 2,000

Quant Small Cap Fund – Rs. 3,300

Bandhan Small Cap Fund – Rs. 2,000

Motilal Midcap Fund – Rs. 2,500

SBI Long Term Equity (ELSS) – Rs. 2,000

Total SIP = Rs. 11,800
Lumpsum in SBI PSU = Rs. 50,000

This is a strong start. You are willing to take risk for long-term growth. But, there are a few important things to fix and improve.

Initial Observations – Risks and Gaps
Overexposure to Small Cap
You have three funds in small cap. That’s about 60% of SIP.
Small caps are volatile. They give good return, but only after 7–10 years.
Too much small cap can cause sharp losses in market correction.

Low Diversification
No allocation to large cap or flexi cap.
These are needed for balance and downside control.
You have only one midcap and one ELSS.

Single Midcap Fund
Midcap helps reduce sharp risk of small caps.
But having only one midcap limits your structure.

PSU Fund Lumpsum
Sectoral funds like PSU are risky.
They depend on government policy and economy cycles.
Don’t add more to this. Hold it, but don’t increase.

Correcting the Allocation
Let’s now divide the total Rs. 40,000 monthly SIP properly.
This will create better balance between growth and stability.

Suggested Allocation:

Large Cap Fund – Rs. 7,000

Flexi Cap Fund – Rs. 8,000

Mid Cap Fund – Rs. 6,000

Small Cap Fund – Rs. 7,000

ELSS Fund (Tax Saving) – Rs. 4,000

Multi-Asset or Hybrid Fund – Rs. 6,000

Total = Rs. 38,000 approx. Keep Rs. 2,000 spare for future increase.

This mix provides:

Stability with large caps

Growth from mid and small cap

Flexibility with flexi cap

Safety cushion with hybrid or multi-asset

Don’t select funds yourself.
Avoid direct funds even if expense ratio is low.
They don’t offer review, rebalancing, or correction.
Invest in regular plans through a Mutual Fund Distributor who is a Certified Financial Planner.
He will help you choose better performing funds and track progress regularly.

Why Reduce Small Cap Exposure
You have high small cap exposure now.
These funds show big returns sometimes. But also fall fast in bad cycles.

You must have small cap exposure. But limit it to 20%–25% of total SIP.
This keeps your portfolio healthy in all market cycles.

More small cap may look attractive now. But it causes worry in bear markets.

Add Large Cap and Flexi Cap
You are missing large cap completely.
These funds are stable, and invest in top 100 companies.

Flexi cap adds flexibility to shift between segments.
Fund managers move across small, mid, and large based on market trend.
This gives better return with less risk.

Both are must for young investors like you.

Add Hybrid or Multi-Asset Fund
You are 100% equity today.
That’s fine for your age, but not always best.
Diversification is needed.

Hybrid funds combine equity, debt, and gold in one scheme.
This helps control the risk. Especially during market fall.
Keep 15% in hybrid or multi-asset for safety.

Add ELSS for Tax Saving Purpose Only
SBI Long Term Equity is an ELSS fund.
These funds have 3-year lock-in.
Use them only if you need 80C tax saving.

If your Section 80C is already filled with PF, PPF, or insurance premium, then skip ELSS.

Otherwise, keep ELSS under Rs. 4,000 monthly.
Don’t use ELSS only for investment. Use it for dual purpose – tax saving and long-term wealth.

Keep Sectoral Fund Exposure Low
You have Rs. 50,000 in SBI PSU fund.
That’s a sectoral theme.

Sectoral funds are not for long-term SIP.
They work only in a specific market cycle.

Do not do SIP in any sector fund.
Do not add more lumpsum.
Hold this fund and track its performance every 6 months.

If it shows good profit after 3–4 years, you may redeem it.
Invest proceeds in diversified equity mutual fund instead.

Increase SIP Gradually
If Rs. 40,000 is not possible from next month, build gradually.

Use this step-up approach:

Next 3 months – Increase SIP to Rs. 20,000

After 6 months – Raise to Rs. 30,000

After 1 year – Reach Rs. 40,000

This prevents stress on your budget.
Also keeps your cash flow balanced.
But set this plan and stick to it.

Direct vs Regular – Choose Wisely
Never invest in direct funds without expert support.

Disadvantages of direct funds:

No guidance

No regular review

You choose based on returns, not suitability

Wrong fund choice can cause long-term damage

Regular funds cost a bit more, but that is for service and monitoring.
Work with an MFD who is also a Certified Financial Planner.

They know how to build goal-based portfolio.
They will also help in:

Goal mapping

Fund switching

Tax planning

Rebalancing in market ups and downs

This professional help is worth the small cost.

Don’t Go for Index Funds
You may think index funds are cheaper and simple.
But index funds come with key limitations.

Problems with index funds:

Blindly follow index stocks

No active decision in poor market

No risk control or rebalancing

You lose flexibility

Actively managed funds have better risk control.
Fund managers exit poor sectors or companies early.
This helps protect capital in falling markets.

So don’t choose index funds for long-term goals.

Tax Impact of Mutual Funds
Understand the tax on your investments.

Equity mutual funds:

LTCG above Rs. 1.25 lakh taxed at 12.5%

STCG taxed at 20%

Debt funds and hybrid funds:

Both short and long term gains taxed as per income slab

Plan redemptions carefully.
Redeem in parts if needed to stay within tax-free limits.
Your Certified Financial Planner can guide better here.

Use SIPs for Future Goals
Plan your SIPs around your future goals.

Break your Rs. 40,000 SIP like this:

Retirement goal – Rs. 12,000

Home down payment after 10 years – Rs. 10,000

Wealth creation (flexible goal) – Rs. 8,000

Emergency fund through hybrid fund – Rs. 6,000

ELSS for tax saving – Rs. 4,000

This gives direction to your portfolio.
Also helps avoid early redemptions.
Goal mapping is important for discipline.

Monitor Portfolio Regularly
Review your funds every 6 months.
Track SIP performance and adjust if needed.
Switch non-performing funds.
Rebalance allocation if small caps rise too much.

Don’t wait 5 years to check returns.
Consistent monitoring ensures long-term success.

Avoid These Common Mistakes
Don’t do SIP in 5 small cap funds

Don’t pick funds based on past returns only

Don’t invest in direct plans

Don’t withdraw SIP money unless goal is reached

Don’t mix tax saving and general investing unless necessary

Stick to a disciplined approach.
Don’t stop SIPs in bad market.
That’s when wealth is created.

Finally
You are on the right path. You have started early.
You are now ready to increase SIP from Rs. 13,300 to Rs. 40,000.

But structure is more important than size.
Build a diversified portfolio across categories.
Avoid overexposure to small cap or sector funds.
Work with a Certified Financial Planner.
Don’t invest in direct funds or index funds.
Review your SIPs and rebalance regularly.

This approach will build strong, lasting wealth.

Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in
https://www.youtube.com/@HolisticInvestment

..Read more

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Nayagam P

Nayagam P P  |9162 Answers  |Ask -

Career Counsellor - Answered on Jul 20, 2025

Asked by Anonymous - Jul 20, 2025Hindi
Career
Hi, my son has secured an admission in a 2+2 BITS CSE program 2025 at Hyderabad (first 2 years) and Iowa state univ (for next 2 years). Under DASA he can potentially get AI at NITK or ECE at NIT Trichy or CSE in NITW (his CRL rank is 25200). Can you please advise and provide recommendations on what we can choose and reasons? We know 2+2 ISU program is more expensive compared to NIT DASA fees but is it worth the money vis-a-vis doing a B.Tech at NIT and doing a masters in US later? For this rank, what can he get at the said NITs under DASA?
Ans: The BITS Pilani–Iowa State University 2+2 CSE offers two years at BITS Hyderabad (ACM-aligned curriculum, NAAC A++ accreditation, state-of-the-art AI, data-science and cloud labs) followed by two years at Iowa State University (top-50 US engineering program, immersive B.S. in Computer Engineering, ISU merit scholarships up to US $4,500/year). Total direct tuition and campus fees for BITS Hyderabad amount to approximately ?10.5 L per year, while Iowa State tuition exceeds US $33,000 annually, plus living expenses. Graduates earn dual degrees with global brand recognition and typically secure near-100% placement through BITS’s 200+ recruiter network and ISU’s strong career services, commanding premium compensation packages in software, data science and R&D roles.

Under DASA with an All-India CRL of 25,200, he qualifies for: B.Tech AI at NIT Surathkal (AI cutoff: 26,688); B.Tech ECE at NIT Trichy (ECE cutoff: 66,706); and B.Tech CSE at NIT Warangal (CSE cutoff: 46,935). Each NIT features NBA accreditation, experienced PhD faculty, modern labs and strong industry MoUs. NITK AI and NITW CSE boast placement rates above 80% and growing AI/analytics recruitment pipelines, while NIT Trichy ECE records near-75% core-sector placements. Annual DASA fees at NITs range from US $15,000–18,000, significantly lower than BITS-ISU costs, with comparable scholarship opportunities limited.

Balancing long-term ROI, the BITS 2+2 path accelerates global exposure, dual-degree credentials and premium placements at higher upfront cost. A B.Tech at NIT followed by a US master’s entails lower initial investment, robust core engineering training and the flexibility to self-fund graduate studies through campus placements or scholarships.

Recommendation: Opt for BITS 2+2 CSE if you prioritise world-class international exposure, dual degrees and, top-tier placement networks despite higher fees. Choose a DASA seat at NIT (AI at NITK or CSE at NITW) for cost-effective core engineering training with solid placement and later pursue a US master’s via merit scholarships. All the BEST for a Prosperous Future!

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Nayagam P

Nayagam P P  |9162 Answers  |Ask -

Career Counsellor - Answered on Jul 20, 2025

Career
Best option in iiit hyderabad for better placement and early internship in btech and dual degree for course cse with speclization ai ml
Ans: Dipanshu, IIIT Hyderabad’s B.Tech in CSE offers an ACM-aligned curriculum covering algorithms, systems, AI/ML, data science and electives in computer vision and NLP, delivered through state-of-the-art AI, cloud-computing and robotics labs. A 12-credit Practice School internship begins in the fifth semester, supported by a proactive placement cell and corporate mentoring, yielding a 99% placement rate for BTech CSE with an average package of ?31.98 LPA over the past three years. Faculty include PhD-qualified researchers with strong industry collaborations, and accredited NAAC A++ status underpins academic quality. The five-year dual-degree integrates the BTech foundation with a research-oriented MS by Research, immersing students in advanced AI/ML theory, thesis work under DST/CSIR grants, and early research assistantships via centres like Kohli Center on Intelligent Systems. Dual-degree cohorts see 100% MS placement at an average of ?26.46 LPA, and graduates often secure RA internships and stipends of ?20,000–?50,000 monthly through lab-based projects. Both paths benefit from IIIT-H’s industry MoUs, interdisciplinary innovation hubs and global recruiter network, yet differ in academic depth, time-to-degree and placement profiles.

Recommendation: Opt for the BTech CSE for its higher average placement packages, structured Practice School internships from year three and broader recruiter diversity. Choose the dual degree if you seek early research immersion, advanced AI/ML specialization, funded thesis work and a stronger pathway into academia or R&D roles. All the BEST for a Prosperous Future!

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Nayagam P

Nayagam P P  |9162 Answers  |Ask -

Career Counsellor - Answered on Jul 20, 2025

Nayagam P

Nayagam P P  |9162 Answers  |Ask -

Career Counsellor - Answered on Jul 20, 2025

Career
My son got admission in KCG college chennai with CSE. Now we got CSE in Amrita Chennai. My concern that Amrita chennai feeswise more than double comes to around 18 laks whereas KCG 8 laks overall Kindly suggest which one is good. Amrita is over burden for me. Still considering my son career I am ready to take loan or something to manage. Kindly suggest which one is goo
Ans: Raj Sir, KCG College of Technology, affiliated to Anna University and AICTE-approved, holds NAAC A+ and NBA accreditation for its CSE programme, a centrally located 50-acre campus with 140+ virtual and physical labs, including specialized AI, cloud and programming facilities. Its dedicated placement cell reported an 88%–94% placement rate over the past three years, with an average package of ?5 LPA and top recruiters such as Accenture, Cognizant, IBM and Amazon. Total tuition fees amount to approximately ?2 lakhs for the entire B.E. course.

Amrita School of Engineering Chennai, a constituent of Amrita Vishwa Vidyapeetham (NAAC A++), operates a 13.5-acre hill-campus with state-of-the-art AI, data-science, cybersecurity and cloud labs, and a strong industry-university research ecosystem. Its CSE graduates achieved a 90%+ placement consistency in 2024, with an average package of ?9.2 LPA and participation from 300+ recruiters including TCS, Wipro, Accenture and Amazon. Total tuition fees for B.Tech CSE are ?18 lakhs over four years.

Academically, KCG offers a robust ACM-aligned curriculum and extensive virtual-lab access, whereas Amrita provides a research-driven, choice-based credit system, extensive centers of excellence, and global collaborations. Both institutions maintain active MoUs and experienced Ph.D. faculty, but Amrita’s higher spend yields stronger median placements and broader recruiter reach.

Recommendation: Opt for Amrita Chennai CSE if investment is feasible, to leverage its superior placement outcomes, advanced research infrastructure and extensive industry linkages. Choose KCG College CSE for an accredited curriculum with solid placement consistency at a significantly lower cost, preserving financial flexibility. MY SUGGESTION: Finalise KCG and advise your son to keep upgrading his skills during the next 4 years, build a strong & professional LinkedIn Profile, improve his soft skills etc., to be competitive among other students for campus placement. All the BEST for a Prosperous Future!

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Nayagam P

Nayagam P P  |9162 Answers  |Ask -

Career Counsellor - Answered on Jul 20, 2025

Asked by Anonymous - Jul 20, 2025Hindi
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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