Ask MF Guru: Is my MF choice right?

Omkeshwar Singh, head, Rank MF, (external link) a mutual fund investment platform, answers your queries:

Rahul Kulkarni: I have SIPs in following funds. Please let me know if I need to do any change in investment. Investment horizon is 8-10 years for a corpus of Rs 30 lakh.

Axis Long Term Equity Fund Direct (G) — Rs 4,000
SBI Focussed Equity Direct (G) — Rs 4,000
HDFC Short Term Debt Fund — Rs 4,000

Omkeshwar Singh: These are good funds in their categories, ie ELSS, focused and short duration debt fund.

If the objective is growth and corpus creation, debt fund can be substituted with equity fund — ie DSP Quant will be suitable.

 

Kishore Gubbi Hirannaiah: I am 45 years old. I need a corpus of around Rs 50 lakh in the next 10-12 years. Planning to invest in MF for next 10-13 years. Should I start SIPs? If yes, which funds to choose or invest in? Currently, I don’t have any investments in MFs. Please advise.

Omkeshwar Singh: SIPs of Rs 5,000 each for 10 years

  • Axis ESG Equity Fund — Growth
  • UTI Flexicap Fund — Growth
  • DSP Quant Fund — Growth
  • Samco Flexicap fund — Growth

Ranabrata Ray: I am investing in two mutual funds SIP since 2019:

LIC MF Index Fund — Sensex Plan — Growth — monthly — Rs 12,000
SBI Nifty Index Fund — Regular Plan — Growth — monthly Rs 6,000

I have only these two funds in my portfolio. Should I continue with these funds? If I am having some more amount to SIP, let’s say Rs 6,000, where should I invest?

Omkeshwar Singh: Index funds are fine, no need to change.

Further investment can be done in

  • Axis ESG Equity Fund — Growth
  • UTI Flexicap Fund — Growth
  • DSP Quant Fund — Growth

Kolluru Krishnamurty: I have around Rs 7 lakh belonging to a 80-G /12 AA Trust of my family in two mutual funds, ie Franklin India Equity Hybrid Fund and Tata Equity Hybrid Fund Regular Plan and I am not getting in Tata Fund as much as I am getting in Franklin. I wish to shift that and also depending on your advice I want to reposition Franklin. Please advise me.

Omkeshwar Singh: Under aggressive hybrid funds there are better options in

  • Axis Equity Hybrid Fund — Growth
  • Canara Robeco Equity Hybrid — Growth

 

Avinash Deshpande: Presently I am investing Rs 1.5 lakh per month. My plan is to have Rs 1 crore in two years and the present MFs are as follows:

Parag Parikh Flexi Cap Growth Direct Plan — Rs 10k

ICICI Prudential Sensex Index Growth Direct Plan — Rs 10k

Tata Digital India Growth Direct Plan — Rs 10k

Quant Infrastructure Growth Direct Plan — Rs 20k

Tata Index Nifty Growth Direct Plan — Rs 20k

Quant Small Cap Growth Direct Plan — Rs 20k

Sundaram Infrastructure Advantage Growth Direct Plan — Rs 2k

SBI Equity Hybrid Growth Direct Plan — Rs 5k

Motilal Oswal Nifty Smallcap 250 Index Growth Direct Plan — Rs 2k

Edelweiss Small Cap Regular Growth Plan — Rs 2k

PGIM India Global Equity Opportunities Growth Plan — Rs 2k

Franklin India Smaller Companies Growth Plan — Rs 60k

Please advise if this is the correct strategy.

Omkeshwar Singh: Need more information — how long have you been investing and what is the present value of the investment?

Rs 1.5 lakhs in two years can create a corpus of Rs 40 lakhs only. Also, two years is a very short duration for equity funds for compounding to work.

Too many funds in the portfolio.

 

Abhijeet Gupte: I have been investing in mutual funds for last five years:

1) SBI Magnum Growth Rs 1,000 monthly

2) Mirae Large asset Growth Rs 500 monthly

3) Aditya Birla Sun life tax relief 96 Rs 1,500 monthly

I want to prepare a corpus of Rs 1 cr for my retirement. Please let me know a few funds to be invested in the next 15 years.

Omkeshwar Singh: SIPs in funds below can be considered.

  • Axis ESG Equity Fund — Growth
  • UTI Flexicap Fund — Growth
  • DSP Quant Fund — Growth
  • Samco Flexicap fund — Growth

Thomas John: Dear Sir,

1. I have invested Rs 3 lakhs in Kotak Global Innovation Fund of Fund, regular growth plan. Since the beginning of this fund, it is showing a downward trend. Should I stay in this fund or exit?

2. I have invested Rs 1 lakh SBI Balance Advantage Fund, regular plan growth. Since the beginning this fund, it is showing slight upward trend. Should I stay in this fund or exit?

Please advise on the above. 

Omkeshwar Singh:

Vidhu Shekhar Pandey: I am a 37-year-old government employee and I want to create a corpus of approx Rs 4 crore on retirement — ie after 20 years. My choice of funds for initial SIP of Rs 17,000 (annual step-up of 10%) is as follows — Mirae Asset Hybrid equity Fund, Rs 6,800 (50%); Parag Parikh Flexi Cap Fund, Rs 3,400 (20%); SBI Focused Equity Fund, Rs 3,400 (20%); SBI Small Cap Fund, Rs 3,400 (20%).

I am not much interested in debt mutual funds as I am investing approx Rs 20k per month in PPF and I have a separate portfolio for my son’s education expenses due after 15 years. Could you please guide on my choice of funds?

Omkeshwar Singh: Your choice of funds is good. However, the weightage towards hybrid is pretty high (40%) considering the investment horizon of 20 years; pure equity funds may be better.

 

Tarun Batra: I am thinking to invest Rs 5k in following funds with tenure of around 5-8 years. Is my choice right?

Sundaram Banking

Union Small Cap

JM Flexi Cap

LIC MF & MidCap

Invesco Focused 20

Invesco Infra

Mahindra Multi Cap

Parag Parikh Flexi Cap

Omkeshwar Singh: Better option listed below is available

  • Axis ESG Equity Fund — Growth
  • UTI Flexicap Fund — Growth
  • DSP Quant Fund — Growth
  • Samco Flexicap Fund — Growth
  • Parag Parikh Flexi Cap

Anonymous: I am 27 years old. I want to invest Rs 11 lakhs in MFs. Can we anticipate markets to remain healthy for next 1 to 1.5 years? I want to invest lump sum. Kindly suggest good funds to me.

Omkeshwar Singh: You may invest in debt — short duration — funds.

 

Azim Arkati: I am around 50 years old. Coming late into mutual funds. Within next five years, my child would be coming for higher education. Can you recommend good funds which would provide a good return of investment in next five years?

Omkeshwar Singh: You may consider the below

  • Axis ESG Equity Fund — Growth
  • UTI Flexicap Fund — Growth
  • DSP Quant Fund — Growth
  • Samco Flexicap Fund — Growth
  • Parag Parikh Flexi Cap

If you want Mr Singh’s advice on your mutual fund investments, please mail your questions to [email protected] with the subject line, ‘Ask MF Guru‘, along with your name, and he will offer his unbiased views.

Disclaimer: This article is meant for information purposes only. This article and information do not constitute a distribution, an endorsement, an investment advice, an offer to buy or sell or the solicitation of an offer to buy or sell any securities/schemes or any other financial products/investment products mentioned in this QnA or an attempt to influence the opinion or behaviour of the investors/recipients.

Any use of the information/any investment and investment related decisions of the investors/recipients are at their sole discretion and risk. Any advice herein is made on a general basis and does not take into account the specific investment objectives of the specific person or group of persons. Opinions expressed herein are subject to change without notice.

Read more of Omkeshwar Singh’s responses here.

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