I have invested in seven different mutual funds through SIP (systematic investment plan) of Rs1,000 since July 2007.All funds are of dividend options.The mutual funds are: Tata Infrastructure Fund; HSBC India Opportunities Fund; Reliance Equity Opportunities Fund - Retail Plan; Kotak MidCap; Sundaram BNP Paribas Select Midcap; Birla Sunlife Equity Fund; and Franklin India Prima Plus. Which of these mutual funds should I hold or exit? Also, please suggest what new funds I should invest in that can yield good returns and whether I should invest in some other asset classes. Anubhav
The funds you have currently invested in are all good funds, though due to the current market situation the returns are negative.
However, at the current level of the market, I would not recommend to exit but would suggest you stay invested and rather add to your portfolio some good schemes, which might offer you decent returns in the long term.
Schemes such as HDFC Top 200, SBI Magnum Contra, Reliance Growth –Growth, DWS Investment Opportunity fund, ICICI Prudential Infrastructure Inst I and SBI Magnum Tax saver could be other good choices to invest in.
I am a 30-year-old computer analyst working for a multinational company in Gurgaon. My annual income is Rs3.8 lakh. I am planning to get married in May 2009. I want to save at least Rs1.75 -2 lakh so that I can arrange a small function then. I have Rs40, 000 in cash. In April 2009, I would withdraw Rs50,000 from my pension policy. I can invest Rs10, 000 every month. Please suggest the best possible investment portfolio option for me.
Since you can invest periodically on a monthly basis, the best option for you is to invest in SIP.
You may invest in growth options of Baroda Global, Tata Infrastructure Fund, BOB Growth, DSPML 100 Equity fund and DSP Merrill Lynch T.I.G.E.R–Reg, Kotak Opportunities fund and Reliance Growth Fund –Gr.
I hope this portfolio offers you decent returns in the time frame you mentioned.
However, you must also take note of tax implications on your returns as it will be during a period of less than one year.
I would like to know the best equity fund where I can start SIP. At present, I have the following portfolio: 1. Tata Infrastructure Fund – one-time investment (Rs6,000) 2. SBI Contra Fund – one-time investment (Rs6,000) 3. Reliance Regular Savings Fund – SIP (Rs1,000 per month) 4. HDFC Tax Saver – SIP (Rs1,000 per month and already completed one year) 5. Kotak Tax Saver – SIP (Rs1,000 per month and already completed one year) My target is Rs2,000-3,000 per month. Can you suggest any one or two better equity funds which I can go for? Ashish
Since you have not mentioned your risk profile, I am using the most common perception of an average-risk and high-return portfolio. You could consider investing in BOB Growth and DSP Merrill Lunch T.I.G.E.R-Reg funds.
Which mutual funds in India are likely to generate returns in excess of 35-40% over the next five years? Arjun Verma
If you mean 35-40% per annum, then I think it is a tough target in the given market scenario.
However, schemes such as DSPML 100 Equity, DSPML T.I.G.E.R– Reg, Sundaram BNP Paribas Select Midcap, Baroda Global, BOB Growth, Tata infrastructure, HDFC Top 200, Kotak Opportunities Fund, Reliance Growth, HSBC Equity, Reliance Diversified Power, etc., are some of the funds that may offer you good returns, which can meet your expectations if the market scenario improves substantially.
While commodity funds invest directly in the physical product, commodity-focused mutual funds invest in companies that produce commodities. How would the returns of the two compare in periods of growth, recession and in times of supply-demand- inventory shocks? Ganga Prasad G. Rao
The profile of the type of funds mentioned by you are different so their returns can not be compared on an equal platform.
For example, a commodity fund, which directly invests in the physical product, has a different set of parameters compared with a fund that invests in companies that deal in the commodity.
Moreover, other factors such as value addition, etc., also play an important role in investment. If a fund invests in a company that adds a lot of value to the commodity, and if the commodity is in higher demand also, it stands a better chance of returns.
However, there cannot be a generalized answer and would largely depend on a case-to-case basis.
Answers are based on a technical analysis of the markets and individual stocks. The views expressed on this page are not the newspaper’s opinion and are provided for information purposes by Vipul Verma. Readers are requested to do their own research before participating in the stock markets. Neither the paper nor the information provider will be responsible for any outcome based on information provided here.