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Omkeshwar

Omkeshwar Singh  | Answer  |Ask -

Head, Rank MF - Answered on Sep 16, 2021

Mutual Fund Expert... more
Shubham Question by Shubham on Sep 16, 2021Hindi
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Till now I have invested around Rs 6 lakhs in Axis Long Term Equity -- Direct Growth and DSP Tax Saver funds over the past four years for tax saving and investment purpose.

Now I want to invest Rs 5 lakhs lumpsum for good returns.

Please suggest some funds for the same.

Ans: It's better to stagger your investment into 12 months. Here are a few funds that may be considered.

Axis ESG Equity Fund -- Growth
Motilal Oswal Focused 25 Fund -- Growth
UTI Flexi Cap Fund -- Growth
ICICI US Bluechip 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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Ramalingam

Ramalingam Kalirajan  |6995 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on May 20, 2024

Asked by Anonymous - May 16, 2024Hindi
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I want to invest lumpsum amount of 1 lakh rupees for a period of 10 years. I can take modest risk with returns expected 20 % and above per year. Which is the best fund to invest in? Also can I invest in tax saver ELSS if yes pls suggest one.
Ans: Investment Options for a Lumpsum Amount of ?1 Lakh
Understanding Your Investment Goals
Investing ?1 lakh with a modest risk appetite and a return expectation of 20% annually is ambitious. While aiming high, it's essential to set realistic expectations and diversify your portfolio to mitigate risk.

Equity Mutual Funds
Aggressive Growth Potential:

Equity mutual funds offer high growth potential but come with higher risk.
Investing in funds with a strong performance history can help achieve your return goals.
Diversified Equity Funds:

These funds invest across various sectors and market capitalizations.
They balance risk by diversifying investments, providing moderate risk with potential high returns.
Sector-Specific Funds:

These funds focus on specific sectors like technology or pharmaceuticals.
High returns are possible but come with higher risk due to sector concentration.
Tax Saver ELSS Funds
Benefits of ELSS:

Equity Linked Savings Scheme (ELSS) funds offer tax benefits under Section 80C of the Income Tax Act.
These funds have a lock-in period of three years, providing long-term growth opportunities.
Choosing an ELSS Fund:

Look for ELSS funds with a consistent track record of high performance.
Ensure the fund aligns with your risk tolerance and return expectations.
Modest Risk with High Returns:

ELSS funds are primarily equity-focused, offering high returns with moderate risk.
They are suitable for investors seeking tax benefits along with wealth creation.
Criteria for Selecting the Best Fund
Historical Performance:

Evaluate the fund’s performance over at least 5-10 years.
Consistent performance against benchmarks indicates reliability.
Fund Manager Expertise:

The experience and track record of the fund manager are crucial.
A skilled fund manager can navigate market volatility effectively.
Expense Ratio:

Lower expense ratios can enhance your returns.
Compare the expense ratios of similar funds to ensure cost efficiency.
Risk-Adjusted Returns:

Assess metrics like Sharpe Ratio and Alpha to understand risk-adjusted returns.
High Sharpe Ratio and positive Alpha indicate better performance relative to risk.
Portfolio Composition:

Review the sectors and stocks the fund invests in.
Diversified and well-balanced portfolios can reduce risk and enhance returns.
Consulting a Certified Financial Planner
Personalized Advice:

A CFP can provide tailored investment strategies based on your financial goals.
Their expertise ensures your investments align with your risk tolerance and return expectations.
Ongoing Portfolio Management:

Regular reviews and adjustments by a CFP can help optimize your portfolio.
They monitor market trends and make informed decisions to maximize returns.
Tax Efficiency:

A CFP can guide you on tax-efficient investment options.
ELSS funds offer tax benefits along with high growth potential.
Advantages of Regular Funds through MFD
Expert Guidance:

Mutual Fund Distributors (MFDs) provide professional advice and support.
They help in selecting funds that align with your financial goals.
Convenience and Support:

MFDs handle administrative tasks, making the investment process seamless.
They offer ongoing support and updates on fund performance.
Conclusion
Investing ?1 lakh with the aim of achieving high returns requires careful planning and informed decisions. Equity mutual funds and ELSS funds are suitable options for achieving your financial goals.

Consulting a Certified Financial Planner and investing through a Mutual Fund Distributor can provide the expertise and support needed for a successful investment journey. This ensures your investments are aligned with your goals and risk tolerance, maximizing the potential for high returns.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

..Read more

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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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