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Omkeshwar

Omkeshwar Singh  | Answer  |Ask -

Head, Rank MF - Answered on Jan 17, 2020

Mutual Fund Expert... more
Vishal Question by Vishal on Jan 17, 2020Hindi
Money

I am an SIP investor in Mutual Funds from past 3 years and below are my SIP investments per month:

Name of the Fund Category RankMF Star Rating
1) NIPPON INDIA TAX SAVER (ELSS) FUND - GROWTH PLAN Equity - ELSS 2
2) IDBI Equity Advantage Fund - Regular Plan - Growth Equity - ELSS 4
3) ADITYA BIRLA SUN LIFE TAX RELIEF 96 FUND - GROWTH Equity - ELSS 4
4) MOTILAL OSWAL LONG TERM EQUITY FUND - GROWTH Equity - ELSS 5
5) Mirae Asset Emerging Blue chip Fund - Regular Plan Growth Option Equity - Large & Mid Cap Fund 4
6) AXIS BLUECHIP FUND - GROWTH Equity - Large Cap Fund 4
7) SBI BLUECHIP FUND -REGULAR PLAN - GROWTH Equity - Large Cap Fund 3
8) LNT Emerging Business Fund - Regular Plan - Growth Option Equity - Small cap Fund 2
9) SBI SMALL CAP FUND REGULAR GROWTH Equity - Small cap Fund 3
10) MOTILAL OSWAL NASDAQ100 FUND OF FUND - REGULAR GROWTH FoFs (Overseas) 4

Ans: 4 and 5 star funds can be continued, rest to be reconsidered

ELSS:

  1.  Canara Robeco Equity Tax Saver Fund - Growth
  2. Axis Long Term Equity Fund - Growth
  3. Motilal Oswal Long Term Equity Fund – Growth

Equity - Large Cap Fund:

  • Mirae Asset Large Cap Fund – Growth
  • Axis Bluechip Fund – Growth
  • LIC Largecap Fund – Growth

Small Cap:

  • Kotak Small Cap fund – Growth
  • Axis Small Cap fund - Growth
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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Omkeshwar

Omkeshwar Singh  | Answer  |Ask -

Head, Rank MF - Answered on Feb 20, 2020

Money
I do a regular investment per month of Rs 9000 as SIP in mutual funds. The funds I am holding currently are:  Name of the Fund Category RankMF Star Rating MohitBhardwaj     1. DSP Equal Nifty 50 Fund-Reg (G)  -Rs 2000 Index Funds - Nifty 2 2. DSP Equity Opportunities Fund-Reg (G) -Rs 1000 Equity - Large & Mid Cap Fund 4 3. DSP Natural Res & New Energy Fund-Reg (G)  - Rs 1000 Equity - Sectoral Fund - Energy & Power 2 4. Franklin India Prima Fund (G)- Rs 1000 Equity - Mid Cap Fund: 2 5. Franklin India Taxshield (G)- Rs 1000 Equity - ELSS 4 6. ICICI PruBluechip Fund (G)- Rs 1000 Equity - Large Cap Fund: 2 7. ICICI Pru Value Discovery Fund (G) - Rs 1000 Equity - Value Fund: 2 8. ICICI Pru Value Fund-16 (G) – Rs 1000 Equity - Value Fund: 2 9. ICICI Pru Value Fund-17 (G)  Equity - Value Fund: 2 10. ICICI Pru Value Fund-18 (G) Equity - Value Fund: 2 11. Invesco India Growth Opp Fund (G) Equity - Large & Mid Cap Fund 4 12. L&T Hybrid Equity Fund-Reg (G)  Hybrid - Aggressive Hybrid Fund 5 13. MotilalOswalMulticap 35 Fund-Reg (G) Equity - Multi Cap Fund: 5 14. Nippon India Capital Builder Fund-IV-A (G)      15. Nippon India NiveshLakshya Fund (G) Debt - Long Duration Fund 5 16. Quantum Long Term Equity Value Fund-Reg (G)   Equity - Value Fund: 2 17. Parikh Long Term Equity Fund-Reg (G) Equity - Multi Cap Fund: 5 18. Tata Hybrid Equity Fund-Reg (G) Hybrid - Aggressive Hybrid Fund 5 I have invested Rs 351,388 till now and my market value is Rs 386,870 which means my annual return is 5.2 per cent. Shall I continue to invest in the above funds or shall I switch to some other better fund as per your advice and what will be my capital (return) if I continue to invest for next 10 years as my current age is 35 years and I wish to invest till my age reach 50.
Ans: You may continue with 4 and 5 star rated funds; for remaining you may consider from below:

Equity - Value Fund:

  • Tata Equity PE Fund - Growth
  • UTI Value Opportunities Fund - Growth Plan

Equity - Multi Cap Fund:

  • UTI Equity Fund – Growth
  • Axis Multicap Fund – Growth

Equity - Large Cap Fund:

  • UTI Mastershare Unit Scheme - Growth Plan
  • LIC MF Large Cap Fund-growth

Equity - Mid Cap Fund:

  • MOSL Midcap 30 Fund – Growth
  • DSP midcap – growth

Equity - Small Cap Fund:

  • Kotak Small Cap Fund – Growth
  • Axis Small cap Fund - Growth

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Omkeshwar

Omkeshwar Singh  | Answer  |Ask -

Head, Rank MF - Answered on Nov 20, 2019

Money
Details of my mutual fund portfolio are as under: Name of the Fund Category RankMF Star Rating Axis Blue Chip Mutual Fund Equity - Large Cap Fund 5 Axis Midcap Fund Growth Equity - Midcap Fund 4 CanaraRobeco Equity Diversified Fund Regular Growth Equity - Multi Cap Fund 4 DSP Small Cap Fund Regular Growth Equity - Small cap Fund 2 HDFC Midcap opportunities Fund Growth Equity - Midcap Fund 3 ICICI Prudential Exports and Services Fund Growth Equity - Sectoral Fund - Service Industry 2 IDFC Multi cap Fund Regular Growth Equity - Multi Cap Fund 4 L&T Equity Fund Regular Growth Equity - Multi Cap Fund 4 L&T India Value Fund Regular Growth Equity - Value Fund 3 Nippon India Multicap Fund  Equity - Multi Cap Fund 2 SBI Blue Chip Fund Equity - Large Cap Fund 4 SBI Consumption opportunities Fund Regular Growth Equity - Sectoral Fund - FMCG 3 SBI Focussed Equity Fund Regular Growth Equity - Focused Fund 4
Ans:

All 5 and 4 star rated funds can be continued, rest can be replaced by the funds below in their respective categories.

Large cap Suitable option considering quality and value for money at present levels is Mirae Asset Large Cap Fund

Large and Midcap Suitable option considering quality and value for money at present levels is Kotak Equity opportunity.

Midcap: Suitable option considering quality and value for money at present levels is DSP Midcap and Axis Midcap

Multicap: Suitable options considering quality and value for money at present levels are UTI Equity Fund, Axis Multicap, Motilal Oswal Multicap 35

Focused: Suitable options considering quality and value for money at present levels are Axis Focused 25 and Motilal Oswal Focused 25

Small cap: Suitable options considering quality and value for money at present levels are Kotak Small Cap and Axis Small Cap

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Latest Questions
Ramalingam

Ramalingam Kalirajan  |7099 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Nov 22, 2024

Money
Sir, I am 55 yrs of age. I want to invest Rs.5000/- pm in Mutual funds for a period of 5 years. Can you suggest me which Mutual funds are best for me to proceed.
Ans: At 55 years, financial planning focuses on achieving a blend of growth, stability, and tax efficiency. A systematic investment of Rs. 5000 per month in mutual funds for five years is a commendable step. This detailed plan outlines an optimal approach tailored to your needs.

Understanding Your Goals
Capital Preservation and Moderate Growth
Your investment horizon of five years suggests a moderate-risk strategy. While growth is important, safeguarding capital is equally critical at this stage in life.

Liquidity and Accessibility
Investments should provide liquidity to meet any unforeseen expenses. Funds with shorter lock-in periods or high liquidity are ideal.

Tax Efficiency
Tax implications can significantly impact net returns. A focus on tax-efficient funds and strategies will maximize your earnings.

Suggested Investment Strategy
A diversified approach ensures a balance between growth and stability. Below is a breakdown of recommended fund types:

1. Actively Managed Equity Funds
These funds can deliver superior returns by leveraging fund managers’ expertise.
They help you capitalize on opportunities that passive index funds miss.
Over five years, these funds can outperform benchmarks significantly.
2. Balanced Advantage Funds
Balanced Advantage Funds manage risk effectively by dynamically adjusting between equity and debt.
They offer stability while ensuring growth through equity exposure.
These are suitable for investors who want moderate risk with decent returns.
3. Debt-Oriented Funds
Debt funds provide stability and are less volatile compared to equity funds.
They ensure a steady income stream with lower risk.
Ideal for a portion of your portfolio to counter equity market fluctuations.
Why Avoid Index Funds?
Index funds track market benchmarks but lack active decision-making.
They do not adapt to changing market dynamics.
Actively managed funds, on the other hand, outperform during volatile periods due to skilled management.
The Pitfalls of Direct Fund Investments
While direct funds seem cost-effective, they require hands-on expertise and time. Investing through a Certified Financial Planner (CFP) offers multiple advantages:

Expert Management: A CFP selects funds that align with your financial goals and risk appetite.
Portfolio Monitoring: They ensure your investments remain on track, adjusting for market changes.
Reduced Stress: You avoid the hassle of analyzing market trends and managing investments independently.
Regular plans through a CFP, combined with professional fund distribution, deliver better returns and convenience.

Allocating Your Rs. 5000 Monthly Investment
Equity Funds: Allocate 40-50% of your monthly investment. Equity funds offer growth and higher returns over five years.
Balanced Funds: Allocate 30-40% for stability. These funds balance growth and protection.
Debt Funds: Invest 10-20% to reduce overall portfolio risk. These funds ensure consistent returns.
By diversifying across these fund types, you minimize risks and maximize returns.

Tax Implications of Mutual Fund Investments
1. Taxation on Equity Funds
Long-term capital gains (LTCG) above Rs. 1.25 lakh are taxed at 12.5%.
Short-term capital gains (STCG) are taxed at 20%.
2. Taxation on Debt Funds
Gains are taxed as per your income tax slab.
Investing for three years or more in debt funds provides indexation benefits.
3. Optimal Tax Strategy
Opt for funds with low turnover to reduce taxable events.
Hold funds for a longer term to benefit from lower tax rates on LTCG.
Key Considerations for Your Investment Journey
Periodic Reviews: Evaluate your portfolio every six months to ensure alignment with your goals.
Avoid Over-Diversification: Limiting your investments to a few funds simplifies tracking and enhances returns.
Reinvestment of Gains: Use returns from mutual funds for reinvestment to maximize compounding benefits.
Benefits of Working with a Certified Financial Planner
A Certified Financial Planner adds immense value to your investment journey. Here's how:

Tailored Investment Plan: They customize fund selection based on your financial goals and risk tolerance.
Expert Portfolio Management: Regular reviews and adjustments enhance your portfolio performance.
Holistic Financial Planning: A CFP aligns your mutual fund investments with other financial goals, such as retirement or child education.
This approach ensures a seamless investment experience with optimal outcomes.

Final Insights
Investing Rs. 5000 monthly in mutual funds over five years can yield significant results with the right approach. By diversifying into equity, balanced, and debt funds, you achieve a balance of growth and stability. Avoid direct and index funds, as they lack the benefits of expert management.

A Certified Financial Planner ensures your investments remain aligned with your goals, maximizing returns while minimizing risks. Regular portfolio reviews and disciplined investing will lead you toward financial success.

Best Regards,

K. Ramalingam, MBA, CFP

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

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Ramalingam

Ramalingam Kalirajan  |7099 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Nov 22, 2024

Money
Sir, I' am 44 Yr. old and doing small savings in LIC and around 6.5 lakhs invested in shares. how can further improve my financial status to grow money.
Ans: Assess Your Current Financial Position
Your dedication to saving and investing shows financial discipline.

LIC savings provide insurance and assured returns but may underperform inflation-adjusted growth.

Rs 6.5 lakhs in shares is a good start for wealth accumulation but is highly dependent on market fluctuations.

You have taken initial steps toward financial independence; now focus on optimising and growing your wealth.

Define and Prioritise Your Financial Goals
Start by clearly defining your short-term, medium-term, and long-term financial goals.

Short-term: Emergency funds, annual vacations, or gadget purchases.

Medium-term: Children’s higher education or down payment for a house.

Long-term: Comfortable retirement, wealth creation, or supporting dependents.

Assign time frames and target amounts to each goal.

Prioritise based on urgency and importance to streamline your investment strategy.

Evaluate and Enhance Insurance Coverage
Life Insurance: Review your current LIC policies. Check if the coverage is adequate to secure your family’s future. A term plan may provide better protection at a lower cost.

Health Insurance: Ensure you have comprehensive health coverage for the family. Choose a policy with adequate sum assured, including critical illness cover.

Avoid combining investment and insurance. Pure insurance plans like term plans are more cost-effective.

Optimise LIC Policies for Better Returns
LIC policies typically offer low to moderate returns compared to inflation and market-linked options.

Evaluate the surrender value, lock-in period, and maturity benefits of existing LIC policies.

If the returns are unsatisfactory, you may consider surrendering or withdrawing them partially.

Reinvest the proceeds into diversified mutual funds for better long-term growth.

Diversify Your Investment Portfolio
Avoid over-concentration in direct shares, as they are highly volatile and require in-depth research.

Mutual Funds: Include equity mutual funds for professional management, diversification, and inflation-beating returns. Choose funds aligned with your risk appetite and goals.

Debt Funds: Invest in debt mutual funds for stability and steady returns, especially for short-term goals.

Gold: Consider allocating 5-10% of your portfolio to gold or gold funds to hedge against inflation.

Mutual Funds: A Better Investment Option
Actively managed funds provide opportunities for higher returns than passive investments like index funds.

Regular funds offer benefits like professional advice and regular portfolio reviews by Certified Financial Planners.

CFPs ensure your investments are aligned with your long-term financial objectives.

These funds are ideal for investors seeking growth while minimising direct market exposure.

Build an Emergency Fund
Create a liquid emergency fund covering 6-12 months of your household expenses.

Use liquid mutual funds or high-interest savings accounts for this purpose.

This ensures financial stability during unforeseen circumstances like job loss or medical emergencies.

Focus on Retirement Planning
At 44, retirement planning becomes critical to securing your post-retirement lifestyle.

Start by estimating monthly expenses during retirement, considering inflation.

Invest in a balanced mix of equity and debt instruments to build a sustainable retirement corpus.

A systematic investment plan (SIP) in equity funds can help accumulate wealth over time.

Strategic Tax Planning
Review your tax-saving investments under Section 80C to maximise deductions.

ELSS (Equity Linked Savings Scheme) mutual funds offer tax benefits and higher growth potential.

National Pension System (NPS) provides an additional Rs 50,000 tax deduction under Section 80CCD(1B).

Ensure your tax-saving investments align with your financial goals and time horizons.

Monitor and Rebalance Your Investments
Periodically review your investments to assess performance and alignment with goals.

Rebalance your portfolio to maintain the desired equity-to-debt ratio as market conditions change.

Avoid impulsive decisions during market volatility; focus on the long-term potential of your investments.

Avoid Common Investment Mistakes
Do not mix insurance and investment in one product, as it often leads to suboptimal returns.

Avoid relying solely on direct equity investments unless you have expertise in stock analysis.

Stay patient with equity investments, as they require a long-term horizon of 5-7 years for optimal growth.

Final Insights
Improving your financial status requires a well-thought-out and diversified investment plan.

Reassess your LIC policies and direct equity investments to optimise returns.

Diversify into mutual funds, build an emergency fund, and focus on tax-efficient investments.

Work with a Certified Financial Planner to develop a tailored strategy for your financial goals.

Take consistent and disciplined actions to grow your wealth and secure your financial future.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

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

...Read more

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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