Do you have mutual fund queries?
Please mail your questions to firstname.lastname@example.org with the subject line, 'Ask Nikunj', along with your name, and Nikunj Saraf, Vice President Choice Wealth, (external link), will answer your queries.
Pratik Ramanuj: Hi Sir. I'm 29 years old. My wife and I both are Government employees. Our combined income is 120000 per month.
I've SIP in following MFs:
Axis Bluechip DG: 5000
Axis Midcap: 3000
Axis small cap: 2000
SBI small cap: 2000
Mirae Asset Tax saver ELSS: 3000
MF portfolio: Approximately 6 lakh
Equity Stock Portfolio: 7 lakh
Kindly guide me whether my selection and allocation of MFs is good or not. Can I get 15% annualised return if stay invested for long term e.g 15 to 20 years? How much should I increase SIP amount annually? Thanks.
Nikunj Saraf: Hello Pratik Ramanuj, it looks like you have invested around 70% of your portfolio in Axis AMC. It is necessary for AMC diversification along with category diversification. Hence, I would suggest reducing the Axis AMC schemes and introducing schemes of peers among same categories.
Additionally, if you wish to add SIPs annually, it is advisable to increase the same with 10-20% of current sip amount.
You may consider the below schemes:
Nippon India Growth
Canara Robeco Flexi Cap
Rajat Agarwal: Hi Nikunj, I am investing in following MFs through SIPs
Kotak India eq contra
SBI magnum midcap
Axis small cap
My goal is to accumulate funds in 10 yrs down the line for my son’s education.
Out of the invested MF kotak is not performing well.
Thanking you in advance.
Nikunj Saraf: Hi Rajat. Regarding your question about Kotak schemes in your portfolio. The scheme is an average performer. You can reconsider it & switch to the same AMC in a different category. You can also reconsider with peer schemes in the same category.
I would suggest introducing schemes from Flexi cap and large cap categories as this category seem missing in your portfolio.
Ashok Jadhav: Sir, which is better option for IT saving U/S 80 C from ELSS M F or SCSS (Sr citizen saving scheme)?
Nikunj Saraf: Hi Ashok Jadhav. Age plays a major role in this, especially if a person's age falls before retirement. ELSSS should be considered.
There is a difference in lock-in period, risk appetite, and returns between the two options -- MF and SCSS.
You can choose ELSS with better returns if you are willing to take moderate risks. SCSS may be a good choice if you want your capital protected with returns similar to those of an FD.
Vipin Mishra: As you mentioned that investment of Rs 1.36L per annum become 2 cr in seven yrs. Please give details of investment plan to achieve this target.
Nikunj Saraf: Hello Vipin Mishra. To achieve 2 cr in 7 years, it is assumed that the expected return as 14% CAGR, also the investment is 1.36L on monthly basis. You may consider categories like midcap, small cap & flexi cap with high risk appetite.
Below are some funds can be considered:
- Nippon India Growth Fund
- PGIM India Mid-Cap Opportunities
- Kotak blue chip
- Canara Robeco emerging equities
Jaya Kiran Kumar Yerramsetti: I am 24 years old and I am planning for a corpus fund of 3-4 cr. I have a sip of Rs 5000 in sbi small cap direct growth. Is it okay for a time period of around 10 to 15 years?
Nikunj Saraf: Hi Jaya. The SBI Small cap Fund is performing well. Still, you may introduce more schemes and categories to your portfolio since diversification is highly recommended.
Saurabh Singh: I want to make an investment with a time horizon of 20 years and my Goal is Higher Education. I am planning a SIP of 1000 INR each month and each financial year I will increase the contribution amount by another Rs 1000.
Should I go for equity way or mutual fund way? Can you help me with your view on this?
Nikunj Saraf: Hello Saurabh. I guess mutual funds -- equity asset class will be more beneficial with child education goal. You may prefer large & mid cap, flexi cap categories for 20 years time horizon and moderate risk appetite.
Also quantify your investment goal to calculate an SIP amount.
KirtiSharma: I am 27 years old and had started investing in MF and other instruments for retirement from last year. I currently invest in the following:
1. Axis Bluechip- 4000
2. Canara Robeco Equity tax saver- 3000
3. HDFC Index Nifty 50- 5000
4. Parag Parikh Flexicap- 3000
5. Axis Small cap- 4000
6. Quant Absolute- 2750
7. Tata Digital India Fund- 2200
8. ICICI Prudential nasdaq 100 Index Fund- 3000
9. PPF- 1.5 lakh annually
10. NPS- 50 k annually
Please advice whether I should discard, change or add any funds to my portfolio. I want to plan for an early retirement at the age of 40 and aiming for a corpus of 5 crore. Please advice on the monthly sip amount to achieve the same and appropriate funds. Thank you!
Nikunj Saraf: Hi Kirti Sharma. The portfolio is well diversified, if you are planning for early retirement with corpus of 5 cr in the next 13-14 years. From your current 27k sips, I would suggest increasing it to 1 lakh sips per month.
In addition to the current SIPs, you can increase them by investing in categories like large & mid-cap, mid cap, etc.
Sandeep B: I am 36 years and working in the Private Sector. I am planning to achieve a corpus of 5 CR in the next 15 years.
Have been investing in the below mutual funds for the past 3 years.Would like to get your suggestion/advice:
- If the categories (diversification -small/Medium/Large/Flexi) invested in are good enough? Or additional categories would be required for a balanced portfolio.
- Amount invested would suffice to achieve the goal or additional step-ups required?
- Have an additional amount of 5 Lakh. In which category/mutual fund can this be invested?
Thanks for your suggestion in advance!
Quant Tax Plan - Direct Growth (ELSS) -- 3000
Kotak Flexicap Fund - Direct Growth -- 1500
Mirae Asset Emerging Bluechip Fund - Direct Growth -- 2500
Mirae Asset Hybrid Equity Fund - Direct Growth -- 4000
Quant small cap Fund -Direct Plan - Growth -- 5000
ICICI Prudential Bluechip Fund Direct- Growth – 5000
Nikunj Saraf: Hi Sandeep. Your portfolio report is in good shape. From your current 21k sips per month, I would suggest increasing it to 70k sips per month to achieve the corpus of 5 Cr in 15 years.
A better peer group scheme should be considered instead of the Kotak AMC scheme. Moreover, reshuffle your portfolio and add SIPs to existing schemes. For lump sum 5 Lakh, you may prefer Flexi cap portfolio.
Aaqib Attar: I wanted to know about TATA Ethical & Taurus Ethical mutual funds. How much return can I expect in 10-15 years horizon? My budget is to invest 5000/ month.
Nikunj Saraf: Hello Aaqib Attar. The mentioned schemes are Thematic funds which prohibit investment from companies that are morally deficient, such as those related to tobacco, alcohol, gambling, lottery, banking & finance services and other prohibited companies.
Returns may vary between 12-14% CAGR.
You can achieve a corpus of Rs 13-25 lakh in 10-12 years with a sip amount of Rs. 5000.
You can read more of Mr Saraf's answers here
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