4 replies on this article “Guidance on mutual funds”

1. moneysights.com says:

   June 14, 2011 at 2:10 pm

   hi Visasubu,

   @Jagadees has given a fairly good explanation. while i wouldn’t be able to add anything new, there are lots of exactly similar discussions which you can refer on this forum for quick reference.

   At moneysights, we don’t advice sectoral funds at all. And if you are looking for a SIP for 10 years w/o any exposure to debt, here is what we could recommend in equal proportion –
   1. HDFC Equity or HDFC Top 200
   2. Birla Sun Life Dividend Yield
   3. ICICI Prudential Discovery Fund
   4. IDFC Small & Mid-cap Equity OR IDFC Premier Equity

   These 4 funds would be enough for good diversification across market-cap, sectors, stocks & fund house-level.

   In case you are looking for some good exposure to debt as well then, following portfolio would work better in equal proportion –
   1. HDFC Children’s Gift Investment Plan
   2. HDFC Prudence
   3. Birla Sun Life Dividend Yield
   4. IDFC Small & Mid-cap Equity

   Hope this helps.
   —
   Santosh | moneysights.com

   Reply
2. Jagadees says:

   June 12, 2011 at 7:02 am

   sorry in the above message i mentioned reliance vision in small and mid cap one. please replace it with reliance growth. typo error.

   Thanks

   Reply
   1. visasubu says:

      June 12, 2011 at 11:52 am

      Thanks Jagadeesh for your inputs.

      Also my husband is investing in following funds for 3 years in SIP which has got over.
      We would like to invest 25k for another 10 years.

      Please let me know your suggestions

      Birla sunlife Equity – 2K
      DSP Black rock opportunities – 2k
      Kotak 50 – 4k
      Tata infrastructure – 4k

      Thanks
      visa

      Reply
3. Jagadees says:

   June 12, 2011 at 7:00 am

   @Visa
   For investing 10,000 rupees per month, You dont need more than 4 funds in your portfolio. This will make your life easier to track the fund and evaluate its performance periodically. Those 4 funds should be across the categories like 2 in large and midcap, 1 in multicap and 1 in small and midcap. First assemble your invested funds in different categories which will make the analysis lot easier to analysis.

   Large and Mid cap:
   1. HDFC Top 200
   2. Reliance vision
   The performance of reliance vision is constantly lagging behind its peers for the past 3 years. Hence i would suggest to replace it with either Franklin india blue chip or Fidelity equity.

   Multicap:
   Kotak opportunities – The performance of this fund is also lagging behind its peers for the past 3 years. Either you can persist this fund for another 1 year or you can consider to switch to better performing multicap fund like quantum long term equity/ICICI pru dynamic/Templeton india growth fund.

   Small and midcap:
   Reliance vision – you can continue investing in this fund, but requires constant monitoring of the performance of this fund.

   Sectoral fund:
   1. Reliance power
   2. DSP Tiger
   Generally am against sectoral fund investing because it narrows the mandate for the fund manager and when the sectoral trend reverses as happened in infra and power sector, then it will dent the returns of the fund. On the other hand when a particular sector has truly long term potential (like financials in today’s market case), then the fund manager of diversified equity fund will automatically increase his sector allocation in his fund. Hence it is not necessary for the retail investors to invest in separate sectoral fund (like banking fund in today’s case).
   These are my suggestions, please do your homework and get convinced before acting on it.

   Regards
   Jagadees

   Reply

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