[pradkumar]

Hi,

There is a 50% portfolio overlap between Birla SL Frontline Equity and Franklin India Bluechip. When you are in a position to stop SIPs, consider another equity large cap which is not concentrated on banking and finance. That will be a tough find because all mutual funds are portfolio heavy on this sector, but if you find nothing else you can consider Motilal Oswal MOSt Focused 25 Fund (expense ratio is on the higher side for this fund) and the overlap will reduce to 24%. If you would like to stick to the Franklin Templeton group, you can consider Franklin India Flexi Cap fund and your portfolio overlap with Birla SL Frontline Equity will reduce to 38%. I don't recommend Mirae Asset Indian Opportunities fund because the overlap would remain above 50% with Birla SL Frontline Equity.

You can download this Excel sheet to compare portfolio overlap of upto 3 funds:

https://freefincal.com/wp-content/up...-Oct-2016.xlsm

Thanks,

Pradeep

Originally Posted by tejas08

Guys,

Need a couple of Suggestions. I have SIPs going on in the following Mutual Funds:

1. Birla Sun Life Frontline Equity
2. Franklin India Bluechip
3. Kotak Select Focus
4. ICICI Pru Value Discovery

Furthermore, I opted for STP for Lumpsum amounts I wanted to invest. These STPs have been started in the following two funds:

1. DSP Blackrock Microcap
2. HDFC Midcap Opportunities

Queries are:

1. Are the funds diverse enough or not? If not, what would be better than this?
2. Since all the investments have been done through Financial Advisor, all of them are under Growth Plan and not under Direct Plans. Is there any way, I can convert from Growth Plan to Direct Plan without affecting by SIP process or do I have to close down current MFs and start direct plan again seperately?
3. Moving forward, I will be increasing the investments through SIP. Does is make sense to opt for two more new funds or increase the SIP investment in couple of the funds, I am already investing in.

[Eyas337]

Hello All - shortlisted below MFs to kick start our investments via monthly SIP's. Plan to stay invested for long term (5-10 years at least).

Please let me know on your thoughts / suggestions.

For Myself:

Equity:
Small Cap: Franklin India Smaller companies Fund (3,000)
Mid Cap: Mirae Asset Emerging Bluechip Fund (3,000)
Mid Cap: Sundaram Select Midcap Fund (3,000)
Multi Cap: Birla Sun Life Equity Fund (3,500)
Tax Planning: DSP Black Rock Tax saver Fund (12,500)

For my Spouse:

Equity:
Small Cap: L&T Midcap Fund (3,000)
Mid Cap: Canara Robeco Emerging Equities Fund (3,000)
Multi Cap: ICICI Prudential Value Discovery Fund (3,500)
Tax Planning: Axis Long Term Equity Fund (12,500)

Hybrid:
Equity-oriented: HDFC Balanced Fund (3,000)

[pradkumar]

Hi,

I don't know your age or risk appetite, but having more than 30% portfolio exposure to mid caps and small caps is probably dangerous. In addition to the small caps and mid caps you have shortlisted, you have an equity multi cap that again has 28% exposure to mid caps. When the markets go down, remember that the mid caps and small caps take the brunt of the fall.

Agreed that large caps have had some bad years before 2017, but there are exceptions. Go find those! You should anchor your portfolio around a pure equity large cap, a balanced fund, and one or two equity multi caps (you already have shortlisted a good one). Create a dummy portfolio with back dated SIP investments of more than 5 years and see the performance, portfolio aggregates, and asset allocation before you proceed.

HDFC Balanced is an excellent fund with a fund manager who has been managing it for more than 10 years and a turnover % of less than 20%. It shows how much conviction the fund manager has in his stock selection! Of course, HDFC Funds are a bit conservative when it comes to stock selection; don't expect any flashy returns, but they are fairly steady when the markets turn choppy.

No fund is perfect. Keep evaluating your portfolio and make changes, if necessary, once a year.

Thanks,

Pradeep

Originally Posted by Eyas337

Hello All - shortlisted below MFs to kick start our investments via monthly SIP's. Plan to stay invested for long term (5-10 years at least).

Please let me know on your thoughts / suggestions.

...............

[Eyas337]

Originally Posted by pradkumar

Hi,

I don't know your age or risk appetite, but having more than 30% portfolio exposure to mid caps and small caps is probably dangerous. In addition to the small caps and mid caps you have shortlisted, you have an equity multi cap that again has 28% exposure to mid caps. When the markets go down, remember that the mid caps and small caps take the brunt of the fall.
============
No fund is perfect. Keep evaluating your portfolio and make changes, if necessary, once a year.

Thanks,

Pradeep

Thanks for your response and valuable feedback. I've shortlisted those based on my research on the fund performance over last 10 years (although past history doesn't guarantee future returns) and tried checking on portfolio overlap % etc., factors along with value research / money control ratings. Will definitely consider a good balanced fund as well on my portfolio.

Have invested in below balanced fund for myself, a lump some onetime investment of 25k for now -
Hybrid: Equity-oriented: ICICI Prudential Balanced Advantage Fund ---> (has average returns and 1.5 years lock in, for no exit load. Should have picked 'ICICI Prudential Balanced Fund' instead, which is better performing and has only 1 year lock in - for no exit load).

For now we are DINK (34 & 29) and want to go aggressive and take risk for at least 5 years from now.

Another thing I noticed regarding the top performing multi and large cap funds is that, there is significant portfolio % overlap (between 25-50%).

[pradkumar]

That is because the large cap universe in India is still small.

Most financial advisors say that mid caps are overvalued currently. I looked at the Portfolio P/E Ratio of the two mid caps you selected. I don't see any major difference. Sundaram Select Midcap Fund is 26.43 and Mirae Asset Emerging Bluechip is 24.88 respectively. Most mid caps are around this figure except for SBI Magnum Midcap, which is above 30. I don't know whether that is a major difference and in the absence of some historical data, it just becomes a number. Will have to look for a site that has historical data for Portfolio P/E Ratio.

Pradeep

Originally Posted by Eyas337

Another thing I noticed regarding the top performing multi and large cap funds is that, there is significant portfolio % overlap (between 25-50%).

[earthian]

For those who use the MF Utilities platform (mfuonline.com) here is a ready reckoner for transactions that are done through this portal. i am informed that the management is working on enabling switch of funds from one AMC to another and that the same would be available soon. That would save us all a lot of grief.

BTW, any idea why these funds have been downgraded to one star by Valueresearch? Have about 25% invested in them. Time to move them out? If so which other funds?

[inder]

Any suggestions which type of MF to chose to put money which I need after 10 months.I am putting this to earn better than savings account return.

[srvm]

Originally Posted by inder

Any suggestions which type of MF to chose to put money which I need after 10 months.I am putting this to earn better than savings account return.

Liquid funds or Money Market funds are ideal for this duration. Quite safe too. Expect returns about 7.5-8.0 % per annum.
Hope this helps.

[lollapalooza]

Yes Liquid or money market funds are ideal for this purpose. But the returns are likely to be 6-7% in the current environment. And this is pre-tax.

[C300]

Originally Posted by Eyas337

Hello All - shortlisted below MFs to kick start our investments via monthly SIP's. Plan to stay invested for long term (5-10 years at least).

Please let me know on your thoughts / suggestions.

.............

Good fund selection. I think Mirae Emerging Bluechip is not available for new subscription. They had recently stopped it.
You can also check Mirae Tax Saver Fund for tax planning.

Originally Posted by pradkumar

Hi,

I don't know your age or risk appetite, but having more than 30% portfolio exposure to mid caps and small caps is probably dangerous. In addition to the small caps and mid caps you have shortlisted, you have an equity multi cap that again has 28% exposure to mid caps. When the markets go down, remember that the mid caps and small caps take the brunt of the fall.

For 10 years timeframe, I think 30%+ exposure to Midcap is not a bad thing. Midcap funds will be more volatile than their big brothers but they have outperformed large caps by a long shot.

[srvm]

Originally Posted by lollapalooza

Yes Liquid or money market funds are ideal for this purpose. But the returns are likely to be 6-7% in the current environment. And this is pre-tax.

I have been getting about 7.5 to 7.8% p.a consistently in 2-3 liquid funds that I have invested so far (investments were done in this financial year, i.e., after 1st April 2017). Even last 2 financial years I got similar or better numbers.

[Pancham]

Originally Posted by C300

Good fund selection. I think Mirae Emerging Bluechip is not available for new subscription. They had recently stopped it.
You can also check Mirae Tax Saver Fund for tax planning.



For 10 years timeframe, I think 30%+ exposure to Midcap is not a bad thing. Midcap funds will be more volatile than their big brothers but they have outperformed large caps by a long shot.

Mirae Emerging is not available for lump sum investment but you can opt for SIPs.

[lollapalooza]

Originally Posted by srvm

I have been getting about 7.5 to 7.8% p.a consistently in 2-3 liquid funds that I have invested so far (investments were done in this financial year, i.e., after 1st April 2017). Even last 2 financial years I got similar or better numbers.

For liquid and money market funds, they typically hold short duration (a few months on average) instruments. And so the benchmark return expectation should be current interest rates on similar tenure credit instruments. If you look currently, the 3 month treasury bill currently yields 6.25% while the 3 month commercial paper yields under 7%. These are the typical products where liquid funds would deploy their corpus. And these returns are before their expenses that would be charged to the fund. Typically expense ratio tends to be 0.2% or thereabouts.

And if a fund in this category earns substantially more than this in the current environment, I would take a serious look at their portfolio to see whether they are taking risks inconsistent with the fund mandate.

[devarshi84]

Any feedback on BOI AXA mid cap equity and debt fund? It seems to be a better fusion with a higher debt holding for safer jump and a mid cap selection for higher returns? but BOI doesnt have many aces under its belt.

Also what is the feedback on Principal balanced fund compared to tata retirement savings fund (progressive) and (moderate)?

[Eyas337]

Originally Posted by C300

Good fund selection. I think Mirae Emerging Bluechip is not available for new subscription. They had recently stopped it.
You can also check Mirae Tax Saver Fund for tax planning.

Checked in valueresearch (VR) website and see it open for subscription. As someone mentioned above, probably lump sum option isn't available.

Went thru your recommendation on tax saving fund from Mirae earlier as well, but since it was recently launched and unrated on VR website vs those having 5-10 years of historic data proving their success. Based on that, chose DSPBR and Axis funds (understand past performance doesn't assure future returns, however instills the required confidence).

Rearranged to below now, to include balanced (hybrid) and large cap funds as well to minimize any loss from small / mid cap.

For Self, shortlisted below from Equity:
1) Small Cap: Franklin India Smaller companies Fund (2,500)
2) Mid Cap: Mirae Asset Emerging Bluechip Fund (2,500)
3) Large Cap: Quantum Long Term Equity Fund (2,500)
4) Multi Cap: Birla Sun Life Equity Fund (2,500)
5) Tax Planning: DSP Black Rock Tax saver Fund (12,500)
6) Hybrid: Equity-oriented: L&T India Prudence Fund (2,500)

Hybrid: Equity-oriented: ICICI Prudential Balanced Advantage Fund (one time 25,000) - will exit from this for a 1% load (about Rs 250). Had opted into this to get the KYC done easily with no hassles.

For Spouse, shortlisted below from Equity:
1) Small Cap: L&T Midcap Fund (2,500)
2) Mid Cap: Canara Robeco Emerging Equities Fund (2,500)
3) Large Cap: Birla Sun Life Frontline Equity Fund (2,500)
4) Multi Cap: ICICI Prudential Value Discovery Fund (2,500)
5) Tax Planning: Axis Long Term Equity Fund (12,500)
6) Hybrid: Equity-oriented: HDFC Balanced Fund (2,500)