When you say put 20pc in snap cap swp, 30pc in mid cap and 50pc in large cap swp, does that mean three separate funds or within a particular SWP fund we get these?
Won't purchasing three different swps increase my tax obligation?
Ans: Separate Funds for Allocation
Yes, it means investing in three separate funds.
This diversification helps manage risk and optimise returns.
Tax Implications
Having three different SWPs will not increase your tax obligation slightly.
Also, the benefit of diversification outweighs the tax implications.
Your Certified Financial Planner can help optimise your tax strategy.
Benefits of Active Funds Over Index Funds
Actively Managed Funds
Actively managed funds often outperform index funds.
Fund managers adjust the portfolio based on market conditions.
Advantages of Regular Funds
Investing through an MFD with CFP credentials provides professional advice.
Better fund selection and portfolio management lead to higher returns.
Final Insights
Using separate SWPs in diversified funds helps in better risk management. Though it might increase tax obligations, the potential for higher returns and risk mitigation is worth it.
Best Regards,
K. Ramalingam, MBA, CFP
Chief Financial Planner
www.holisticinvestment.in