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Mutual Fund SIP: Whether you are an experienced investor with a financial portfolio or just starting, here are some fund recommendations by financial expert Samir Shah. The financial expert spoke exclusively to ET Now Sawadesh on the Bano Apna Finance Minister show, where he answered investors’ queries and recommended funds to help investors accumulate 30 lakh rupees in six years. Let’s look at the investors’ questions and the fund recommendations by the financial expert to see if they are part of our portfolio.
Mutual Fund SIP: Investor portfolio
- ICICI Bluechip: Rs 1.5 lakh
- Nippon India large cap: Rs 1.5 lakh
- Motilal Oswal large and mid cap: Rs 1.5 lakh
- Motilal Oswal mid cap: Rs 1.5 lakh
- Bandhan small cap: Rs 1.5 lakh
- Parag Parikh Flexi Cap: Rs 5 lakh
- Jio Black Rock Flexi Cap: Rs 1 lakh
- Motilal Oswal Manufacturing: Rs 1 lakh
- ICICI Prudential multi-asset: Rs 1 lakh
- HDFC Balanced Advantage: Rs 1 lakh
The expert recommended trimming the portfolio to 5-6 schemes. For instance, retain only one of the two large cap funds, one Flexi Cap fund, and avoid overlapping sectors such as manufacturing. Focus on long-term performance, risk management, and historical drawdowns rather than the brand name alone.
For a balanced investment strategy, the suggested portfolio allocation is:
- 30% in large-cap (choose either ICICI or Nippon India)
- 30% in Parag Parikh Flexi Cap
- 10% in Motilal Oswal mid-cap
- 15% in Bandhan small-cap
- 15% in ICICI multi-asset fund
Mutual Fund SIP: Investor portfolio
A 22-year-old new investor planning to invest Rs 25,000 per month. The investor’s goal is very short-term; he wants Rs 30 lakh in six years. He mentioned he will step up his investments every month by approximately 5 per cent and seeks an expert strategy for that.
Arjun intends to invest Rs 25,000 every month with a 5 per cent step-up in his SIP investment. At this rate, his investment would grow almost double in 18 to 20 months, said the expert. In six years, his investment would grow to around Rs 9 lakh. However, his target is to grow his investment to Rs 30 lakh.
To achieve his target more comfortably, Arjun can either increase his SIP investment to Rs 26,000 or step up his investment to 7 per cent. In either case, his target can be achieved. Keeping in mind his investment period of six years, a portfolio was created that is not very aggressive.
According to the expert, 50 per cent can be invested in a flexi cap mutual fund, 30 per cent in large and mid cap mutual funds, and 20 per cent in growth-oriented mutual funds like mid-cap or small cap funds. In mid-cap funds, HDFC’s mid cap fund can be recommended. In small cap funds, Manthan’s small-cap fund can be recommended if Arjun is willing to take more risks.
Mutual Fund SIP: Investor query
An investor asked about when the right time is to invest in mutual funds. The investor, willingly, has 5-6 lakh lying idle and wants to invest it.
According to the expert on lump-sum equity investments, one must consider market timing carefully. Currently, Nifty is down about 10 per cent from its high, so many of investors’ favourite stocks are available at discounted rates. Investing now allows you to accumulate more units compared to a rising market.
The expert further adds that for lump sum investments, especially in a volatile market, it’s safer to invest in a staggered manner (via SIP or systematic transfers). For example, if you want to invest Rs 6 lakh, you can invest 20 per cent immediately in a multi cap or multi asset fund, including equity, gold, and silver, and gradually move the remaining from liquid funds to equity over the next 4-6 months.
Suggested allocation by Expert
Suggested allocation: 40 per cent in Parag Parikh Flexi Cap Fund (invest gradually over 4-6 months), 30 per cent in large and mid cap funds, and 10 per cent in HDFC mid cap for riskier exposure.
(Disclaimer: The above article is meant for informational purposes only, and should not be considered as any investment advice. ET NOW DIGITAL suggests its readers/audience to consult their financial advisors before making any money related decisions.)
