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Mutual Fund Corner: Should I change my mutual fund portfolio to meet my goals?

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Want to invest in mutual funds but don’t know how to go about it? Get all your mutual fund related queries answered by our expert, Himanshu Srivastava, senior research analyst, Morningstar Advisers India, on our show Mutual Fund Corner.

Mutual Fund Corner: Should I change my mutual fund portfolio to meet my goals?
Want to invest in mutual funds but don’t know how to go about it?
Get all your mutual fund related queries answered by our expert, Himanshu Srivastava, senior research analyst, Morningstar Advisers India, on our show Mutual Fund Corner.

Q: 28-year-old Raunak Surana writes to us from Rajasthan. I started investing in mutual funds since January 2018. I am currently investing Rs 20,000 per month as SIP in mutual funds linked with my goals. Please suggest me about my portfolio, are these funds good, do they need any change either in specific fund or amount of SIP pertaining to my goals.
My portfolio is-
1. For child's education - Rs 1 crore in 20 years
Funds are -
a. ICICI Bluechip: Rs 5,000 per month
b. ABSL Focussed Equity: Rs 2,500 per month
c. ABSL Tax RLF 96: Rs 2,500 per month
2. For child's marriage - Rs 1 crore in 27 years
Funds are -
a. HDFC Midcap Opp: Rs 2,500 per month
b. PPFAS Long Term Equity: Rs 1,500 per month
3. For my retirement - Rs 4 crore in 32 years
Funds are -
a. Mirae EMG Bluechip: Rs 2,500 per month
b. Axis Multicap: Rs 2,500 per month
c. Tata Consumer: Rs 1,000 per month
All funds are growth option and direct plan. I have a term plan of Rs 1.5 crore from Max Life and health insurance from Max Bupa (Floater).
A: It's really a good investment planning, where you are making goal-based investments with defined timelines, which is a rarity.
  • First let’s discuss whether you will be able to reach the corpus that you have set for yourself for each goal within the defined time lines.
  • You would be able to reach close to your targeted corpus in case of your first two goals that is child education and marriage.
  • However, you will fall short of achieving your target corpus for your retirement with the current investments that you are making in this regard. But if you increase your SIP for this goal to Rs 9000 per month. You should reach your target.
  • Coming to your portfolio, you should consider adding large cap funds in the portfolio for Child’s marriage. These funds provide stability to the portfolio over the long term and should ideally be the core holding.
  • In your retirement portfolio, you have scope to add few more funds. So, consider adding large, mid and small cap funds in your portfolio. You can consider replacing Axis Multicap and Tata Consumer Fund with these funds. While Axis Multicap is a new fund and does not have a long-term track record, Tata Consumer is a sector/thematic fund which is typically a very high risk high return investment proposition.
  • Some of the funds which you may consider adding are:
    Group/InvestmentMorningstar Analyst RatingMorningstar Rating OverallReturns (%)
    1-Yr3-Yr5-Yr
    Large-Cap
    Aditya BSL Frontline Equity GrSilverÙÙÙÙ-4.618.9014.26
    DSP Top 100 Equity Reg GrBronzeÙÙ-8.346.2210.34
    Franklin India Bluechip GrGoldÙÙÙ-5.356.8112.05
    HDFC Top 100 GrGoldÙÙÙÙ-1.5711.1914.81
    ICICI Pru Bluechip GrSilverÙÙÙÙÙ-1.0610.9614.34
    Reliance Large Cap GrSilverÙÙÙÙÙ0.4910.9017.58
    SBI Bluechip Reg GrBronzeÙÙÙÙ-5.247.9315.24
    UTI Mastershare Unit Reg GrBronzeÙÙÙ-0.628.0413.03
    Mid-Cap
    Aditya BSL Mid Cap GrBronzeÙÙÙ-14.807.9320.32
    DSP Midcap Reg GrSilverÙÙÙÙ-10.3510.9522.32
    Franklin India Prima GrGoldÙÙÙÙ-7.189.7521.74
    HDFC Mid-Cap Opportunities GrGoldÙÙÙÙÙ-8.7111.0822.91
    ICICI Pru Midcap GrBronzeÙÙÙ-10.239.4523.43
    SBI Magnum Midcap Reg GrBronzeÙÙ-15.374.1520.03
    Sundaram Mid Cap GrBronzeÙÙÙ-13.798.5022.03
    Small-Cap
    DSP Small Cap Reg GrSilverÙÙÙÙ-18.827.3326.72
    Franklin India Smaller Companies GrSilverÙÙÙÙ-14.268.7923.57
    HDFC Small Cap GrBronzeÙÙÙÙ0.4216.6620.74
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