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Is my mutual fund portfolio diversified?

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Updated: Dec 04, 2019, 03.20 PM IST
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SIP investment22
I have a moderate to high risk appetite and I can stay invested for 5-7 years. My expectation is to have around 15-16% annual returns.

The schemes which I have picked up are:
Mirae Asset Emerging Bluechip Fund
Mirae Asset Large Cap Fund
Kotak Standard Multicap Fund

I have a few questions regarding that:
1. Are these schemes good enough? Also, is the portfolio diversified enough in terms of the risk as well as the holdings of the schemes? Should I add a debt fund also? If yes, then can you please suggest a good debt fund?

2. What should be the ratio of amount invested between these schemes in monthly SIPs?

3. I also have around Rs 4 lakh parked in liquid funds. I was thinking of moving them to equity funds over time. What would your suggestions be for the frequency and amount to invest a lumpsum money in current market conditions? I know that Mirae Asset Emerging Bluechip Fund is not accepting lumsump money. So, should I increase its ratio in monthly SIP and keep adding lumsump to other schemes?

4. If I could save Rs 40,000 to Rs 70,000 per month, what amount should I commit as SIPs and to lumsump?

5. Do you think I might be taking too much risk if I am investing all of my savings like this? Your suggestions will be highly appreciated.

First, if you do not understand much about mutual funds, we would strongly recommend you to take the help of a mutual fund advisor. Only an advisor near you can offer you personalised advice after obtaining all your details. Forums like this can only offer general advice.

You should try to keep your investments simple. Adopt a goal-based investment strategy. Identify all your financial goals, both short and long-term. Try to quantify your goals and provide for inflation to arrive at a realistic target. For short-term goals of below four years, stick to bank deposits and debt mutual funds. Invest in equity mutual funds to achieve long-term financial goals.

You should always choose a mutual fund scheme based on your goals, investment horizon, and risk profile. Take an online quiz to assess your risk appetite. Do not assume your risk profile. Once you know the risk profile, you should always choose your mutual funds that are in line with it.

You have stated that your risk profile is moderate to high. It is a bit vague. Try to define it sharply: conservative, moderate, aggressive, very aggressive, etc. If you are a moderate risk-take, you should invest mostly in multi cap mutual fund schemes. If you want to take a little extra risk, you may consider taking some exposure to mid cap mutual funds.

You have unrealistic return expectations. It is safe to assume 12 per cent annual return from equity investments over a long period.
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