Designing My Investment Portfolio

POSTED BY kau9mar ON September 5, 2012 8:37 pm COMMENTS (7)

Hello,

Firstly, I want to congratulate you on the excellent work you are doing, forums like this is a big boon for self directed investors like me where one can learn a lot by reading and at the same time benefit from other’s experience. Well Done!

Until now, i have always relied on traditional investments like bank fixed deposits, recurring deposits. Of late, i have forayed into Mutual funds. Based on the knowledge i have gained from forums likes these, value research and moneycontrol, i have started investing in the following funds. I am looking at equity mutual funds for long term (retirement, child’s education) and debt funds for short term (accumulating money to pay off home loan quicker, holidays and emergency fund). I would greatly appreciate your views on my self designed portfolio as decribed below. I am 30 years of age.

Large Cap: DSP BlackRock – Top 100 Equity – Rs. 6000/ month

Small and Mid Cap: SBI Magnum Emerging Businesses-G -Rs. 6000/ month

Gold ETF: Goldman Sachs (GOLDEX) – Rs. 3000/ month

Debt Short term: HDFC Short term opportunities – Rs 5000/ month

Debt long term: SBI Dynamic Bond Fund – Rs. 5000/ month

Look forward to your recommendation.

 

Thanks

Kaushik

 

 

7 replies on this article “Designing My Investment Portfolio”

  1. kau9mar@gmail.com says:

    Hi Ashal,

    thank you for providing a different perspective on the no.of.units towards Gold ETF. Now i am thinking even 500 gms of gold will not suffice (given the fact that gold is one of the most sought after commodity in marriages of our community). Perhaps i will reduce my investments into the deb funds and increase the units in gold etf or look at adopting an “Increasing SIP” approach towards the gold ETF.

    Thanks all for your views and suggestions.

    Regards
    Kaushik

  2. kau9mar@gmail.com says:

    Hi Ramesh,

    Thank you for your suggestion, I tend to agree with you regarding SBI Mangnum Emerging Business, I know it is a risk and as experts say it is a fund for people who can “stomach steep falls”. I have been investing in it via sip for the last 6 months. I know this is a very very less tenure to judge an equity fund, but it seems like it is a good performing fund. But I am really in two minds whether or not to continue. IDFC Premier Equity and HDFC – Mid Cap Opportunities were my second and third choice in this segment.

    Thanks
    Kaushik

  3. kau9mar@gmail.com says:

    Hi Manish and Ashal,

    In reply to both your questions, below is my response:

    At the very outset, i wanted to begin with a fairly diversified portfolio – Equity:Debt mix of 70:30 (based on my age).

    Equity:

    I zeroed in on one large cap and one small and mid cap. The funds i have mentioned here is based on the star ratings (crisil and value research) as well as past performance history. I am looking at 10 – 15 years investment horizon for these funds, basically to build the retirment corpus.

    ETF:

    I wanted to use Gold ETF as a vehicle (as opposed to traditional way of buying physical gold) to accumulate the funds for daughter’s marriage. Investment horizon for this is again 10 – 15 years. I selected Goldman Sachs based on the reviews – i beleive they have the largest AUM in the gold ETF category, lesser expense ratio and one of the best returns (though there isn’t much difference in the returns in comparison to SBIGETS and Reliance Gold ETFs)

    Debt Funds:

    These are for short term needs – 2-3 years investment horizon.

    I chose two debt funds just to manage them better for two disticnct investment goals.

    1) Accumulate funds to pay off the prinicpal on home loan once every 18 – 24 months.
    2) Accumulate funds for family vacations, major lifestyle expenses – once in every 12 months,

    Regarding, PF – that is part of my salary – employer and employee contribution put together approx – 1.2 lacs/year. I am not keen on investment via PPF, looking at investment options with returns at minimum 12% over a long term horizon.

    My question to you is, are my fund selection appropriate? do you have any other recoomendations in terms of different funds or diversification?

    Thanks… Kaushik

    1. Ramesh says:

      Perfect.

      There is nothing wrong with your strategy. Absolutely spot-on regarding your number of funds in equity and debt (2 each), your selection of GS-gold etf, etc.

      Regarding your fund selection, I have a few, you can say, side-issues.

      1. I have a little problem with your choice of mid-small cap fund. In my opinion, the performance of SBI fund’s is not a long term one, combined with a not so good management team of SBI. My suggestions will be to get a fund with quite decent pedigree like
      i) DSP Mid and Small Cap (not Microcap). But if you opt for this fund, you should change DSP Top 100 to some other like Franklin Blue Chip or HDFC Top 200.
      ii) IDFC Premier Equity. Very nice fund.
      iii) Franklin Prima is a good fund too (19 years management experience).

      Otherwise, good thinking.

      Ramesh

    2. Dear Kau9mar, fund selection part is OK. The Eq. fund & your discussion with Dear Ramesh is also OK. You may go for IDFC Prem. Eq.

      I’m answering for your Gold ETF part. The fund selected by you is ok. Instead of purchasing a single unit mly basis. Firstt determine your exact requirement. Say marriage of your d’ter is 20Y away, it means you have some 240 months in your hands. Now if you want to gift say 500 gm of gold, it roughly means 2 units of Gold ETF mly.

      So think over it.

      Thanks

      Ashal

  4. Dear Kau9mar, my question is also same, how did you opted these funds & why 2 funds? What about your other investments like PF, PPF……..?

    Thanks

    Ashal

  5. How did you choose this all ? For what term ? Why 2 debt funds ?

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