Thanks a bunch for the response Mr.Ramalingam sir. I would really appreciate if you can shed some light on few flexi cap funds.
Do you think I have to stop any current fund or continue with same and add either of large or flexi cap fund to the folio for diversification and risk appetite.
I have twin girls of age 2 and wanted to save big numbers for their future alongside.
Thanks for your time again!!
Ans: Flexi cap funds are a popular category in mutual funds that offer flexibility in terms of investment across market capitalizations (large cap, mid cap, and small cap). These funds can adapt to market conditions and capitalize on opportunities across sectors and market segments.
Advantages of Flexi Cap Funds:
Diversification: Flexi cap funds invest across market caps and sectors, providing diversification and potentially reducing portfolio volatility.
Flexibility: The fund manager has the flexibility to shift allocations based on market conditions, which can help in capitalizing on opportunities and managing risks.
Potential for Growth: Flexi cap funds can benefit from growth opportunities across the market spectrum, from large established companies to smaller, high-growth potential companies.
Should you stop or continue with current funds?
Assess Current Portfolio: Evaluate your current mutual fund portfolio to understand its composition, performance, and alignment with your investment goals.
Check Overlapping: If your current funds already have significant exposure to large cap stocks, adding a flexi cap fund can provide exposure to mid and small cap segments, enhancing diversification.
Risk Appetite and Diversification: If you have a moderate to high-risk appetite and are looking for diversification across market caps, adding a flexi cap fund can be beneficial. However, if your current portfolio is well-diversified and aligned with your risk profile and investment goals, there may not be a need to stop any existing funds.
Performance Review: Regularly review the performance of your existing funds. If any fund consistently underperforms its benchmark or peers, consider replacing it with a better-performing option.
Considerations for Investing for Twin Girls' Future:
Long-Term Horizon: Since your twin girls are just 2 years old, you have a long-term investment horizon. Flexi cap funds, with their adaptability and potential for growth, can be suitable for long-term investment goals.
Risk Tolerance: While aiming for high returns, it's crucial to consider your risk tolerance. Ensure your investment strategy aligns with your risk tolerance to avoid potential stress during market downturns.
Regular Review: As your daughters grow and their financial needs evolve, regularly review and adjust your investment strategy to ensure it remains aligned with their future goals.
Consultation with Financial Planner: Given the importance of saving for your daughters' future, it's highly recommended to consult with a certified financial plannerr. They can provide personalized advice based on a thorough understanding of your financial situation, goals, and risk tolerance.
Remember, while flexi cap funds can be a valuable addition to your investment portfolio, it's crucial to choose funds that align with your investment goals, risk tolerance, and time horizon. Always consider seeking professional advice before making investment decisions.
