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Ask Mint Money | Review portfolio periodically to ensure schemes are performing well

Ask Mint Money | Review portfolio periodically to ensure schemes are performing well
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First Published: Sun, Oct 23 2011. 09 18 PM IST

Updated: Sun, Oct 23 2011. 09 18 PM IST
I have the following investments: Rs 1,000 each through systematic investment plans (SIPs) in ICICI Prudential Dynamic, ICICI Prudential Focused Bluechip, Kotak 50, HDFC Top 200, DSP BlackRock Small and Midcap and UTI Dividend Yield Fund. I also have SIP investments in SBI Magnum Taxgain 1993 (Rs 1,500), Principal Smart Equity (Rs 2,000), Canara Robeco Yield Advantage Fund (Rs 3,000) and Kotak Gold Fund ETF (Rs 1,000). I have a time frame of 8-10 years and a target of Rs 12 lakh. Am I on the right track?
—Suyash
Given your monthly investment, your target corpus is easily achievable. In fact, even if you place the money (Rs 13,500 per month) in a savings account for eight years, you would have more than your target of Rs 12 lakh. So, given that you are investing your money in a diversified, market-exposed portfolio of funds, you can definitely hope to have more money in your corpus when you need it.
As far as your portfolio goes, it is well diversified across fund types and fund houses. Most of the funds in the portfolio are category leaders in terms of long-term performance and are good choices. However, some schemes—from Principal and Canara Robeco—are recent and do not have proven track records. You can hold on to them if you are convinced about their suitability for your portfolio. Else, you can switch to other similar funds such as Canara Robeco MIP (instead of the Yield Advantage fund) and Birla Sun Life ’95 (instead of the Smart Equity fund).
I have SIPs of Rs 2,000 each in IDFC Premier equity, Reliance Equity Opportunities and UTI Opportunity Fund. I also invest Rs 1,000 in ICICI Prudential Focused Bluechip fund. Is my choice of funds fine? I want 10-12% returns. Also, how do I maintain my portfolio in the long term?
—Sundeep
You have selected good funds—they are diversified across different fund houses and cover the breadth of the market segments well. The ICICI fund is a pure large-cap fund and the IDFC fund focuses on the mid-cap segment. The other two funds are blended funds that cover both large- and mid-cap segments. Your expectation for returns is moderate and it should be possible to achieve it over the long term.
As time goes by, review the portfolio periodically to ensure that the schemes are performing well and continue to belong in your portfolio. Also, you may want to increase the monthly amount of investment over a period of time. When you do so, pay attention to the allocation of investment across categories of funds. As it stands now, you will do well to allot any additional funds into the large-cap sector—you can either increase your investment in the ICICI Prudential Focused Bluechip Fund or add another fund, either DSP BlackRock Top 100 or Franklin India Bluechip.
Srikanth Meenakshi is founder and director, FundsIndia.com
Queries and views at
mintmoney@livemint.com
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First Published: Sun, Oct 23 2011. 09 18 PM IST