Portfolio Rebalancing

POSTED BY Venkatesh ON February 29, 2012 7:24 pm COMMENTS (5)

Dear all,

I am NRI for 15+ years in Gulf. I am relatively new to Investing and Mutual Funds. I have the following MF in my portfolio with ICICI Direct, which were purchased about 18 months ago, both through lumpsum and SIP.

Scheme Value at NAV Profit/ Loss %
BIRLA SUN LIFE TAX RELIEF 96 FUND- DIVIDEND 839 -17.46
HDFC TAX SAVER – GROWTH PLAN 5805 13.6
RELIANCE EQUITY OPPS FUND – GROWTH PLAN 2813 2.08
HDFC EQUITY FUND – GROWTH PLAN 24621 -12.41
DSP BLACKROCK TOP 100 EQUITY FUND – GROWTH 17086 -5.66
Canara Robeco MIP Growth Fund 5836 14.21
RELIGARE TAX PLAN – GROWTH 3251 6.62
HDFC TOP 200 FUND – GROWTH PLAN 50235 -5.61
ICICI PRUDENTIAL DYNAMIC PLAN GROWTH 29410 -2.33
BIRLA SUN LIFE FRONTLINE EQUITY FUND – GROWTH 24191 -10.77
SUNDARAM SELECT MIDCAP – GROWTH 42908 -10.85
CRMF-Equity Tax Saver Dividend Fund 5958 -8.23
DSP BR TAX SAVER FUND – DIVIDEND OPTION 5225 2.24

I wish to rebalance my portfolio. Please advise me how to go about this.

Tax saver funds have 3 yrs lock in period, Should I sell the Robeco growth fund which shows 14% profit?

Also, I have a surplus savings of Rs.12-14L, which I would like to invest. Please let me know what are the available options for the same (STP etc). I want to include Reliance Gold ETF in the above portfolio.

My age is 41, married, NRI. risk appetite – High.

Apart from the above, I have some Bank FDs and few small investments in Jewellery & Real Estate.
I have another query also: I don’t have any insurance as of date, but would like to take a Term plan. Being NRI, I can’t do it immediately till my next visit to India. To avoid these hassles, can I start a SIP on the premium amount for 20 years? Would it give the same returns as a Term plan or somewhere near to that?

Thanks in advance for all your guidance.

5 replies on this article “Portfolio Rebalancing”

  1. Dear Venkatesh, yes it’s a god idea to divert the prem. meant for those LIC policies in to MFs.

    Thanks

    Ashal

  2. Dear Venkatesh, please purchase a term plan as soon as possible. Please start mailing for the same now to the Indian insurer you are interested in.

    Please redeem your Sund. select midcap fund now & invest it in to IDFC, the recovery of your money ‘ll be faster in an already performing fund.

    Please check Eq. section of I-Direct to purchase Gold ETF. In the MF section, you ‘ll only see Gold saving funds.

    Thanks

    Ashal

  3. Venkatesh says:

    Thank you ZionView & Ashal for your guidance.

    ELSS was a blunder from my side. I will sell off the same once the lock in period is over.

    Reg. Insurance, I had 3 LIC policies, which I surrendered last year, after reading all that is discussed here regarding life insurance. I’m planning to take a Term plan from ICICI when I next go to India. However, please let me know if it will help if I invest the premium in MFs, instead of paying to insurance company. Does this sound practical?

    Regarding disposing of Sundaram Midcap, which is showing a loss of 11%, should I close it now or wait for breaking even or may be average it and then shift to IDFC? Please advise.

    I checked ICICI Direct for Gold ETF. However, they sell only Gold Funds. Do you have any idea on this also?

  4. Dear Venkatesh, you need a proper financial planning for your over all situation. But I’m trying to answer your queries in this forum.

    As you are NRI, not many indian Insurer ‘ll offer you any Term cover. Please purchase a term cover in the country you are residing in as of now. From your query it’s not clear when ‘ll you return to India for permanent stay but I assume, you ‘ll return around age 55. So you have around next 14Y for the basic term cover requirement. Please purchase a term cover there itself.

    Regarding your MF portfolio, here is my take –

    No fresh investment in any Tax saver funds now on wards.

    RELIANCE EQUITY OPPS FUND – GROWTH PLAN 2813 2.08 – consolidate it in to HDFC Eq.

    HDFC EQUITY FUND – GROWTH PLAN 24621 -12.41 OK invest more

    DSP BLACKROCK TOP 100 EQUITY FUND – GROWTH 17086 -5.66 consolidate it into HDFC Top 200

    Canara Robeco MIP Growth Fund 5836 14.21 OK invest more

    HDFC TOP 200 FUND – GROWTH PLAN 50235 -5.61 OK invest more

    ICICI PRUDENTIAL DYNAMIC PLAN GROWTH 29410 -2.33 OK invest more

    BIRLA SUN LIFE FRONTLINE EQUITY FUND – GROWTH 24191 -10.77 OK invest more

    SUNDARAM SELECT MIDCAP – GROWTH 42908 -10.85 consolidate it into IDFC Prem. Eq & then invest more into that fund

    Thanks

    Ashal

  5. TheZionView says:

    Venkatesh,

    You defensively need a financial planning which can be done by professional. You can look out services in jagoinvetor.org

    You need to have below things in check
    1.Emergency Fund
    2.Term Insurance
    3. Health Insurance

    If you are an NRI i dont understand the need for ELSS tax MF in your potfolio. You have 12 funds which is just large number and doesnt mean diversification.
    Please keep the no of funds to 4. You can retain below funds from existing portfolio going forward closing or redeeming other funds

    1. Franklin India Bluechip- Large Cap Fund

    2. HDFC TOP 200 FUND – GROWTH Large and Mid Cap Fund

    3. You have SUNDARAM SELECT MIDCAP in Mid cap category but i would recommend IDFC premier Equity or Birla Sunlife Dividen Yield Plus.

    4. RELIANCE EQUITY OPPS FUND – GROWTH PLAN or HDFC EQUITY FUND – GROWTH this will be you Multi cap fund

    Just maintain these four funds and monitor their performance twice or once a year and take appropriate action

    Do not go for lumpsum if you are not having a investment horizon of 7+ years. Do SIP on the above funds.

    I don’t think there is online term insurance for NRI(please check). It should be taken as soon as possible. Is it possible to take one in the country you reside?

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