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Ramalingam

Ramalingam Kalirajan  |6968 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on May 18, 2024

Ramalingam Kalirajan has over 23 years of experience in mutual funds and financial planning.
He has an MBA in finance from the University of Madras and is a certified financial planner.
He is the director and chief financial planner at Holistic Investment, a Chennai-based firm that offers financial planning and wealth management advice.... more
Asked by Anonymous - Mar 24, 2024Hindi
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Hi Ulhas sir,I am 40 years old, my goal is retirement with 5 cr. I am investing 25k through SIP in the following Funds. 5k- icici pru bharat 23fof 5k-motilal oswal mid, 5K-Quant large and mid, 5k-Nippon Small cap 5k-Quant small cap, All Direct Funds. Investment Horizon - 20 to 22 Years. Goal -please check my portfolio,Wealth Creation, Risk Appetite- High. Please advise if I should pause or continue with these mutual funds.

Ans: You've chosen direct MFs, which can be a cost-effective way to invest. However, there are some things to consider:

Strengths of Your Portfolio:

Diversification: Your portfolio has a good mix of funds across market capitalizations (large, mid, small). This helps spread risk and capture growth potential across different sectors.

High Risk Appetite: Given your high-risk appetite, the small-cap allocation provides the chance for potentially higher returns, but also comes with higher volatility.

Direct vs. Regular Funds:

Lower Cost: Direct MFs eliminate advisor fees, resulting in a lower expense ratio. This can potentially lead to higher returns over the long term.

Do-It-Yourself Approach: Direct MFs require you to research and select funds yourself. You'll also need to monitor your portfolio and make investment decisions independently. Actively managed funds involve experienced fund managers who try to pick stocks to outperform the market. Actively managed funds come with higher fees compared to passively managed funds.

Areas for Potential Review (with a CFP):

Asset Allocation: A Certified Financial Planner (CFP) can analyze your risk tolerance and investment horizon in detail. They can recommend an ideal asset allocation between equity and debt funds to optimize your portfolio for your retirement goal.

Fund Selection: While your chosen funds are from reputable fund houses, a CFP can assess their performance history, investment strategies, and fees to ensure they align with your goals.

Benefits of a CFP:

Personalized Plan: A CFP can create a comprehensive retirement plan considering your income, expenses, existing investments, and risk profile.

Expert Guidance: They can provide valuable insights on investment strategies, asset allocation, and navigating market volatility.

Remember:

Market Fluctuations: The stock market is volatile. Stay invested for the long term to ride out market ups and downs.

Regular Review: Review your portfolio (at least annually) with your CFP to ensure it remains aligned with your evolving goals.

Overall, you've built a good foundation! Consulting a CFP can help fine-tune your portfolio and potentially maximize your chances of achieving your retirement goal.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in
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  |6968 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Apr 01, 2024

Asked by Anonymous - Mar 24, 2024Hindi
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Hi sir,I am 40 years old, my goal is retirement with 5 cr. I am investing 25k through SIP in the following Funds. 5k- icici pru bharat 23fof 5k-motilal oswal mid, 5K-Quant large and mid, 5k-Nippon Small cap 5k-Quant small cap, All Direct Funds. Investment Horizon - 20 to 22 Years. Goal -please check my portfolio,Wealth Creation, Risk Appetite- High. Please advise if I should pause or continue with these mutual funds.
Ans: Based on your investment horizon, risk appetite, and goal of accumulating 5 crores for retirement over the next 20 to 22 years, let's evaluate your current mutual fund portfolio:

ICICI Prudential Bharat 22 FOF: This fund aims to invest in a diversified portfolio of equity and equity-related securities of companies participating in the growth of Indian economy, and also in units of Bharat 22 ETF. As it focuses on large-cap and well-established companies, it can provide stability to your portfolio. However, since it's a fund of funds (FOF), it may have slightly higher expenses compared to regular equity funds.

Motilal Oswal Midcap 30 Fund: This fund primarily invests in mid-cap stocks, which have the potential for high growth but also come with higher volatility compared to large-cap stocks. Given your high risk appetite, this fund can be suitable for your portfolio as it aims to capture the growth potential of mid-sized companies.

Quant Large and Mid Cap Fund: This fund follows a quantitative investment approach, which uses mathematical models to select stocks based on predefined criteria. While quantitative strategies can offer a systematic approach to investing, it's essential to assess the fund's track record and performance consistency over time.

Nippon India Small Cap Fund: Investing in small-cap companies can provide significant growth opportunities, but it also comes with higher risk and volatility. Given your risk appetite, allocating a portion of your portfolio to small-cap funds can be suitable for long-term wealth creation, provided you can tolerate the associated volatility.

Quant Small Cap Fund: Similar to Quant Large and Mid Cap Fund, this fund follows a quantitative approach to investing but focuses on small-cap stocks. As with any small-cap fund, be prepared for higher volatility and fluctuations in returns.

Considering your high risk appetite and long investment horizon, your current portfolio appears aligned with your goals. However, it's essential to regularly review your investments and monitor the performance of your funds. If any fund consistently underperforms or deviates from its investment mandate, consider replacing it with a better-performing alternative.

Additionally, since you have a long investment horizon, you can consider increasing your SIP amounts periodically to benefit from the power of compounding and accelerate wealth accumulation. As always, consult with a financial advisor to ensure your investment strategy remains appropriate based on your evolving financial circumstances and goals.

..Read more

Ramalingam

Ramalingam Kalirajan  |6968 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on May 09, 2024

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Hi sir,I am 40 years old, my goal is retirement with 5 cr. I am investing 25k through SIP in the following Funds. 5k- icici pru bharat 23fof 5k-motilal oswal mid, 5K-Quant large and mid, 5k-Nippon Small cap 5k-Quant small cap, All Direct Funds. Investment Horizon - 20 to 22 Years. Goal -please check my portfolio,Wealth Creation, Risk Appetite- High. Please advise if I should pause or continue with these mutual funds.
Ans: Looks like you've got a good head start on your retirement savings plan! It's great that you're investing consistently through SIPs and have a long investment horizon. Let's break down your portfolio:
Good Diversification: Having a mix of funds across large-cap, mid-cap, and small-cap captures different risk-reward opportunities. This is a good approach for building wealth over the long term.
High Risk Appetite: Your fund selection indicates a high-risk appetite. This can potentially lead to higher returns, but also means your investments can experience more ups and downs along the way.
Consider Portfolio Review: While a general overview looks promising, a more in-depth analysis might be helpful. A Certified Financial Planner (CFP) can assess your individual risk tolerance, investment goals, and review your specific fund choices to ensure they align with your overall plan.
Staying the Course: Remember, market fluctuations are normal. Don't panic and make impulsive decisions based on short-term dips. If you have a long-term view (20-22 years) and stay invested, your SIPs can help you ride out market volatility.
Keep an Eye on It: Periodic reviews are important. Markets and your financial goals can evolve over time. A CFP can help you monitor your portfolio and make adjustments as needed.


There are some advantages to consider direct funds, and the cost savings can be significant in the long run. However, there are some potential benefits to using a regular MFD:
Advantages of Investing Through a Mutual Fund Distributor (MFD):
• Personalized Advice: MFDs can be helpful for beginners or those who lack investment knowledge. They can assess your risk tolerance, financial goals, and investment horizon to recommend suitable mutual funds. This personalized guidance can be valuable, especially if you're new to investing.
• Convenience: MFDs handle all the paperwork and transactions on your behalf, saving you time and effort. They can help with account setup, SIP registrations, and managing your portfolio across different funds.
• Investor Support: MFDs can be a point of contact for any questions or concerns you may have about your investments. They can provide ongoing support and guidance throughout your investment journey.

Overall, you're on the right track! Keep up the good work!
Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in

..Read more

Ramalingam

Ramalingam Kalirajan  |6968 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Apr 30, 2024

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Hi sir,I am 40 years old, my goal is retirement with 5 cr. I am investing 25k through SIP in the following Funds. 5k- icici pru bharat 22fof 5k-motilal oswal mid, 5K-Quant large and mid, 5k-Nippon Small cap 5k-Quant small cap, All Direct Funds. Investment Horizon - 20 to 22 Years. Goal -please check my portfolio,Wealth Creation, Risk Appetite- High. Please advise if I should pause or continue with these mutual funds.
Ans: Your investment approach demonstrates a proactive mindset towards achieving your retirement goal. With a high-risk appetite and a long investment horizon of 20 to 22 years, you've chosen funds that align with your objectives.

Your portfolio consists of a mix of funds across various market caps, providing diversification and potential for growth. However, it's essential to periodically review your investments to ensure they remain aligned with your goals and market conditions.

Given your high-risk appetite, the funds you've selected appear suitable for wealth creation over the long term. However, consider monitoring their performance regularly and adjusting allocations if needed. Additionally, stay informed about economic and market trends that could impact your investments.

As you progress towards your retirement goal, you may consider rebalancing your portfolio periodically to maintain an optimal mix of assets. Consulting with a Certified Financial Planner can provide valuable insights and guidance tailored to your specific circumstances.

Overall, your proactive approach to investing and commitment to long-term wealth creation are commendable. By staying disciplined and informed, you're on track to achieve your retirement goal of 5 crores. Keep nurturing your investments, and they're likely to flourish over the years ahead.

..Read more

Ramalingam

Ramalingam Kalirajan  |6968 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on May 09, 2024

Asked by Anonymous - Apr 17, 2024Hindi
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Hi sir,I am 40 years old, my goal is retirement with 5 cr. I am investing 25k through SIP in the following Funds. 5k- parag parikha flexi cap 5k-motilal oswal mid cap 5K-Quant large and mid cap 5k-Nippon Small cap 5k-Quant small cap, All Direct Funds. Investment Horizon - 20 to 22 Years. Goal -please check my portfolio,Wealth Creation, Risk Appetite- High. Please advise if I should pause or continue with these mutual funds.
Ans: It's fantastic that you're planning ahead for your retirement, and your investment strategy reflects your goal of wealth creation with a high-risk appetite. Let's review your portfolio:
1. Parag Parikh Flexi Cap Fund: This fund follows a flexible investment approach, investing in a mix of large-cap, mid-cap, and small-cap stocks. It's known for its diversified portfolio and has a track record of delivering consistent returns over the long term.
2. Motilal Oswal Mid Cap Fund: Mid-cap stocks have the potential for higher growth but also come with higher volatility. This fund focuses on mid-cap companies with strong growth prospects, suitable for investors with a higher risk tolerance.
3. Quant Large and Mid Cap Fund: This fund combines large-cap and mid-cap stocks, aiming to provide capital appreciation over the long term. Quantitative techniques are used for stock selection, which can add a unique flavor to your portfolio.
4. Nippon Small Cap Fund: Small-cap stocks have the potential for significant growth but are more volatile. This fund focuses on small-cap companies with growth potential, aligning with your high-risk appetite.
5. Quant Small Cap Fund: Similar to the previous fund, this one specifically targets small-cap stocks using quantitative methods for stock selection.
Considering your investment horizon of 20 to 22 years, your portfolio seems well-diversified across different market segments, aligning with your high-risk appetite and wealth creation goal. However, it's essential to regularly review your portfolio's performance and make adjustments if necessary.
I recommend consulting with a Certified Financial Planner periodically to ensure your investment strategy remains on track with your retirement goal and risk tolerance.

Shifting from direct to regular mutual funds can offer several advantages, especially for investors seeking personalized support and guidance:
Regular mutual funds provide access to the expertise of a Mutual Fund Distributor (MFD) who is often a Certified Financial Planner (CFP). They can offer valuable insights, emotional handholding, and personalized guidance tailored to your financial goals and risk tolerance.
MFDs can assist with asset rebalancing, helping you maintain an optimal allocation of assets based on market conditions and changes in your financial situation. This ensures your portfolio remains aligned with your investment objectives over time.
Scheme selection can be overwhelming with numerous options available in the market. An MFD with CFP credentials can help navigate this complexity by recommending suitable funds that align with your risk profile, investment horizon, and financial goals.
By opting for regular mutual funds through an MFD, you not only gain access to professional advice but also benefit from ongoing support and assistance throughout your investment journey. This can instill confidence and peace of mind, knowing that you have a trusted advisor by your side.
Consider making the switch to regular mutual funds to leverage the expertise and guidance of a Certified Financial Planner through a Mutual Fund Distributor. It can enhance your investment experience and increase the likelihood of achieving your retirement goal of 5 crores.

Keep up the good work with your disciplined SIP investments, and stay focused on your long-term financial objectives.

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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