mutual fund: MF queries answered by Suresh Sadagopan, Founder, Ladder7 Financial Advisories


Sep 27, 2017, 09.56 AM IST


I am 32 years old and want to invest regularly for 10 years with a goal of accumulating Rs 1 crore. I have started SIPs in the following funds from March 2017: SBI Bluechip (Rs 2,000), L&T Infrastructure (Rs 1,000), Franklin India Smaller Companies (Rs 1,500), Birla Sun Life Monthly Income Plan II Wealth 25 (Rs 2,000), ICICI Prudential Banking and Financial Services Fund (Rs 1,000), L&T Midcap Fund (Rs 1,000). In addition, I am also investing Rs 10,000 per month in NPS Tier 2. I have a recurring deposit of Rs 10,000 per month at 7.5 per cent for five years. Please advise on any change in my portfolio or any other fund.


With this investment pattern, you would not be able to reach Rs 1 crore. But, having a random number target is not going to help as one would tend to take more risks than warranted if you were to pursue this. Assets need to be allocated based on your goals, risk profile, number of years of work, dependencies in the family, timing of goals, etc. You investments would probably need some professional help. There are just too many SIPs. Maximum of two are enough. You need to also have a reason to invest in NPS Tier 2, but that needs to be a compelling one. Liquid funds ultra short-term funds from the mutual fund stable would perform the job of providing liquidity quite well. Recurring deposits would be offering poor returns on a post tax basis. Debt mutual funds are suggested. But to get all this right, seek out a proper financial advisor.

I have invested a lumpsum amount in mutual funds with a time horizon of at least five years. I would like to know whether these are the right ones to invest and how much returns can I expect. Please advise if I need to make any adjustments or change my investments. I aim to accumulate at least Rs 7 crore from my lumpsum investment of Rs 2.5 crore. The funds that I have invested in are as follows: 1. SBI Bluechip Fund Rs 20 lakh 2. SBI Midcap Fund Rs 20 lakh 3. L&T India Value Fund Rs 1.5 crore 4. L&T Emerging Business Rs 50 lakh 5. SBI Magnum Balanced Rs 10 lakh.


You have invested Rs 2.1 crore out of your Rs 2.5 crore in mid and small cap funds. Hope you have allocated in this manner after giving it sufficient thought. You cannot invest just looking at the returns these funds have given till date. How the funds will perform in future is unknown. That is why having a proper asset allocation and investing as per one’s risk profile and goals becomes important. To reach Rs 7 crore in five years, you need to get a return of about 23 per cent, which is a tall order. Returns in exclusion, have no meaning. To me, it looks like you could consider more allocations to large cap, multicap and balanced funds. As may be necessary, you should also consider some allocation in debt funds.

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