What are the best mutual funds available in the market? Which funds accrue maximum profits? What are the crieria for evaluating a fund?
Which funds provide the best SIP options? Are SIPs the easy way of making quick bucks? When and how should one buy mutual funds?
In an hour long chat on rediff.com on Thursday, mutual fund expert Rahul Goel replied to many such readers' queries. Here is the transcript
Rahul Goel says, Good afternoon! Welcome to the discussion on financial planning! Let's start!
Kaveri asked, Hi, I have reliance growth, HSBC advanced India growth fund,Biral sunlife infrasturcture fund 10,000 rupees each and SIP monthly 1000 rupees for reliance diversified growth from last month.Also have ICICI prodentialinsurance for 20,000 per year and Birla sunlife insurance 10,000 per year for IT returns. Is this portfolio enogh or do I have to maintain more?
Rahul Goel answers, at 2008-05-15 13:02:43kaveri, hi. your portfolio of funds does not have any of the schemes we consider to be 'core' in a portfolio with a long term outlook. we are referring to funds like hdfc equity. as we have often said, sector funds should not account for more than 5 - 10% of a portfolio.
vaishali asked, i have around 12000 - 15000 monthly to be invested. i already have a PPF, homeloan and LIC.What should be my next invest ment policy so that it earns me a good returns as well as tax benefit
Rahul Goel answers, vaishali, hi. its good to invest keeping the tax angle in mind. however, don't let that limit your investment options... if you have a long term investment horizon and have appetite for near term risk, then you should look at adding equity funds in your portfolio. the long terms returns from these incidentally as of now are tax free. but even if there were to be a tax, they may still make great investment sense for you. be carefull about how much savings based insurance you take... ideally you should be taking only term insurance to being with.
Suman asked, I wanted go in for a child insurance plan which is equity linked. Or should i just directly invest in a Mutual Fund via SIP for the same goal. Can you name a few insurance plans/MFs for this purpose that i can research on?
Rahul Goel answers, suman, hi. in our view, sips would work better. build a portfolio of funds suited for the purpose... and also, take a term insurance for the earning member/s of your family.
sujit asked, Hello Sir, I am 23 yr old. I want to invest 20000 monthly. Suggest me some good funds or shares so that i can get good return in long term. Also now i want to invest 100000 at a time. Where i ll invest?
Rahul Goel answers, sujit, hi. great that you are starting to invest early! i recommend that before you actually invest any money in funds or shares, you read our free guide on investing (for the the youth). its called the money simplfied and is available on www.personalfn.com
Tushar asked, Hello Rahul, I want to invest 20k per month in 4-5 MFs to generate 1 crore. How much period will it take to generate 1 crore. Please suggest some good MFs which will give good returns.
Rahul Goel answers, tushar, hi. that should take you about 14 yrs. and this is assuming an absolute value of rs 1 cr... not adjusting for inflation!
RK asked, Rahul, I have two questions. 1. I invested Rs.15,000 in SBI Comma Fund (G), Rs. 20,000 in SBI Magnum Tax Gain (D), Rs. 3000/month SIP in ICICI Infrastructure fund & Rs. 10,000/year in HDFC Young Star ULIP... How is my Portfolio and how can I improve. 2. I am 32 yrs Old and wanted to retire at 55 and if I wanted to earn around 3-4Cr by 55, how do I plan ? Please advise.
Rahul Goel answers, hi. your portfolio consists of thematic funds and ULIPs, aside of the ELSS that you have invested in. both in our view are not recommended as investments you should begin to build your portfolio with. coming to the goal... if you wish to accumulate Rs 4 cr, without factoring in inflation, you need to set aside about rs 20,000 pm in assets earning you 15% pa to achieve your goal; however if you assume inflation to be 6% pa, then you will need to set aside about rs 75,000 pm in 15% assets.
Nisha asked, Dear Rahul, I would like to visit a financial advisor personally..do they provide services only to HNIs only? How will they charge for a one time advise?
Rahul Goel answers, nisha, hi. this will depend on the financial planner. the policy at personalfn at present is to meet all prospects.
Prithanka asked, Hi Rahul, I am a 29 yr old IT professional with a take-home salary of 52K p.m. and an investable portion of around 15K from the above. My current investments include these - JPMorgan India Equity Fund (G), Reliance Diver. Power - RP (G), Sundaram Energy Oppor. (G) - with 15K invested in each of them (one time investment - long term horizon). I also have a home loan, with an EMI of around 15K. Please suggest me the funds which will build a good portfolio (preferably through SIP) looking towards a horizon of 3 - 5 years.
Rahul Goel answers, hi. not sure who has been advising you on the funds you own, but you can surely do a lot better. its time you had a long chat with your advisor... all you won is sectoral funds, and one fund which is from a newly floated amc. suffice it to say that if you were to come to personalfn, none of the funds you presently own would find a place in our recommended portfolio.
manojchawla asked, Dear I want to invest in SIP on monthly approx 5-10000 should i go with seperate Fin. Institutions or can go with anyone and which of the institution is best please tell me thank
Rahul Goel answers, manoj, hi. its good to have about 5/6 funds in total...some of which could be from different AMCs. however, the allocation between the funds will need to reflect your needs and profile.
ab asked, I want to start investing thru SIP for my daughters education. Please suggest some goods funds?
Rahul Goel answers, hi. build a portfolio of equity funds... about 5/6 schemes... have growth funds like hdfc equity and also value style funds like quantum long term equity (Disclosure: both personalfn and quantum mutual fund are founded by the same person). idea is to diversify among fund houses and also styles of management.
Gautam asked, Hi, Is gold a good investment or
Silver makes more sense?
Rahul Goel answers, gautam, hi. we look at gold as an 'insurance'... and accordingly recommend that our clients have about 5 - 10% of their monies in this asset.
siva asked, Dear rahul, I would like to invest Rs. 25,000/month in mutual funds thruogh SIP. This is basically investment purpose. Please advice.
Rahul Goel answers, siva, hi. well, if you are looking at accumulating monies over 3 - 5 yrs, opt for equity funds... be careful in the fund selection. an honest financial planner will come in handy here...
anand asked, Hello Mr. Rahul, My annual package is 10lakhs and I have invested 1.5lakh in SBI Magnum, 1 Lakh in HDFC equity , 75 thousand in Reliance Mutual Fund Besides I have one LIC policy for Rs. 80,000/ and one Metlife Policy for Rs. 10 Lakh. My question is - if I can save 5Rs. lakh per annum, how to plan my investments so as to become financially free by the year 2020.Also, please guide me how to plan my investments to make it more productive. Thanks, Anand.
Rahul Goel answers, anand,hi. i am unable to answer your question as i do not know how much income you need to become financially free! what i can tell you is that if you are able to save rs 5 lakhs every year till 2020, and invest it in 15% yielding assets then you can build a corpus of about rs 1.5 crs... this when invested in say 5% low risk securities can earn you rs 7.5 lacs per year...
rakesh asked, How to choose good fund for investing through SIP ?
Rahul Goel answers, rakesh, hi. on personalfn you will find a free guide (money simplified) which will guide you through the process of fund picking... pl can you read that. thanks!
prasad asked, Dear Mr.Rahul, Greetings from Prasad. I've invested Rs30000 in DSPML technology.com before one year. It is constantly declining due to IT slowdown, shall I hold it or book the losses?
Rahul Goel answers, prasad, hi. investing in a sectoral fund always carries additional risks. i think you should revist the reasons why you invested in this fund in the first place... also consider a diversified equity fund, whcih can own tech stocks if the prospects are good; in case of a tech fund, the fund manager will have to hold tech stocks no matter what the prospects...
hiteisee asked, my daughter (12yrs age)has won rs80,000/-. pl let me know where & how to invest for a period of 10 years so as to get a return of at least 10 times.
Rahul Goel answers, hi. well, your daughter definitely seems to have started early when it comes to accumulating wealth! if the tenure is 10 yrs, then have a mix of equity funds and maybe some schemes like post office deposits. ideally an all equity portfolio would do, but i guess your daughter may not want to see the rs 80,000 go much into the red!
praneel asked, I am the earning member (10.0L/annum)of my family and want to invest in life insurance. My present LIC+ICICI prulife is only covering 2.0L. Pls suggest good plans to cover atleast 10.0L insurance
Rahul Goel answers, praneel, hi. simply take term insurance... also, you will need maybe rs 50 l of insruance or even more... work out your human life value (free calc on personalfn is available) and take the policy accordingly.
sachin asked, Is investement in Mutual Fund is better than Stock Market?
Rahul Goel answers, sachin, hi. the answer to this will depend on two things. one whether you have the skill to pick good stocks consistently... and two, whether you have the time to devote to this activity of stock picking. if either one of this is missing, its mutual funds for you!
Rajesh asked, Hello sir; almost all advisors recommend to invest in equities for long term to fetch a return of 15 to 20%.is their any reputed advisor/mutual fund who can guarantee at least 15% return.I am ready to invest for long term(5,7 or ten years to be decided by fund). moreover, I am ready to give 50% fee of profit exceeding 15%.
Rahul Goel answers, rajesh, hi. there are no guarantees when you are investing in the stock markets! one can only give a view based on his/her study.
samitbisen asked, Hi, Good afternoon. What are your views on etf's?
Rahul Goel answers, hi. ETFs are a great way to take exposure to commodities and the broader stock markets. but here again choose an ETF which has lower costs...
Sid asked, Hi Rahul, Do gold ETFs give the SIP option?
Rahul Goel answers, hi. no they don't. but you can always instruct your stock broker to buy you a fixed number of units every month...
arun1964 asked, rahulkthe best product is to buy an index fund min cost max return.coorect me if i am wrong
Rahul Goel answers, arun, hi. you are not wrong.... low cost index funds is a great way to invest. however, we belive that actively managed funds can outperform the index in the indian context for some time to come.
vin12397 asked, Hi Rahul,I am 40 yr old and is looking for Lifecover of app.50lac.LIC agent suggested to opt for one of the policy investing Rs.23000.00 p.a. but with no return.Kindly inform if it is ok or pl. suggest any other option. Also pl. suggest any good policy/sip/mf to get back app. 50 lac for my child afyter 10yrs.I can plan to invest accordingly from current year itself.VK
Rahul Goel answers, hi. not sure what the policy being recommended you is, but it appears to be a term policy. if it is, then its best for you.
Shirish asked, I want to invest around Rs. 1.5 lac please do let me know under present scenario, where should I?
Rahul Goel answers, shirish, hi. i am unable to guide you as i do not know even basic things like the purpose for investing the money, or the risk appetite you have, or even the tenure of investment. having said that, if you do not have appetite for much risk, you should not be invested in equity/balanced funds. instead opt for FMPs, MIPs...
name asked, I have a one year boy. Which child plan I need to go for? what is the basis to decide.
Rahul Goel answers, hi. do you really want to go in for a insurance policy?! suggest you invest in the money in instruments like mutual funds and PPF. and take a term insurance for the earning members of your family.
Rahul Goel says, Thank you all for participating in this discussion. If you have any queries, you can always write into info@personalfn.com.
