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    Is my mutual fund portfolio good to create Rs 5 crore?

    Synopsis

    If you have any mutual fund queries, message on ET Mutual Funds on Facebook. We will get it answered by our panel of experts.

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    I have been investing in the following mutual fund schemes for the last two years.
    SBI Bluechip Fund: Rs 5,000
    HDFC Mid-Cap Opportunities Fund: Rs 5,000
    ICICI Prudential Value Discovery Fund: Rs 5,000

    Is my portfolio good for a long-term investment? I want to invest for over 15 years. I am expecting a return of 15% from these three mutual fund schemes. I have a moderate risk profile. My goal is Rs 4-5 crore in 20-25 years.
    --Nikesh Surana

    Tarun Birani, Founder and CEO, TBNG Capital Advisors, responds:

    All the funds you have chosen are good. You can continue your SIPs in these schemes. However, I would like to inform you that value funds can underperform significantly for extended periods of time. This is particularly true in market conditions like the present, where (PE) multiples drive share prices rather than earnings growth. Simply put, the market is driven by not just earnings, it is also driven by optimism and that is why the PE multiple increases quite substantially. And when this era ends, value funds might regain its shine. Value mutual funds have given good returns over long term but can underperform in the short term. To earn 15% returns, an investor should remain patient and stay invested for a longer duration.

    Your funds have the potential to generate higher returns, given their category, but as an investor one should focus on long-term goals and align the investments accordingly.

    Things You should consider
    • Annualized Return
      for 3 year: 2.18%
    • Suggested Investment
      Horizon: >3 years
    • Time taken to double
      money: 3.0 Years
    SBI Bluechip Fund-Growth ★★★★★
    Things You should consider
    • Annualized Return
      for 3 year: 1.23%
    • Suggested Investment
      Horizon: >3 years
    • Time taken to double
      money: 4.11 Years
    To create a corpus of Rs 5 crore, you need to invest Rs 51,000 for a period of 20 years, assuming an annual return of 12%.
    (If you have any mutual fund queries, message us on ET Mutual Funds on Facebook. We will get it answered by our panel of experts.)
    The Economic Times