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Which MFs to invest in? Here's help

January 03, 2008 17:11 IST
Do things like mutual funds baffle you? Are you aware of the investment options they provide?

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 Thursday, mutual fund expert Rahul Goel answered many such readers' queries. Here is the transcript:

Rahul Goel says, 
Good Afternoon! Welcome to the discussion on financial planning! Lets start!

Tushar asked, One of my friend (age 45) want to Invest Rs.10 Lac. She has no income. She is more interested in monthly income. She is staying alone in Ghatkopar (1BHK) own flat. Please suggest investment plan.
Rahul Goel answers,  at 2008-01-03 12:56:34tushar, hi. well thre are some options out there including post office monthly income scheme, hdfc deposits and ofcourse MIPs from mutual funds. the exact allocation will depend on among other things the monthly income she requires and the variability in income she can withstand.
InvesStart asked, I am planning to invest in HDFC Equity+Top200, Franklin PrimaPlus+Flexicap, Reliance Vision, Fidelity Equity, DSPML Equity What is your view about my portfolio. Shall I consider any mid cap fund or remove any one from the list. Please advice
Rahul Goel answers, hi. why are you investing in both hdfc equity and top 200? and prima plus and flexxicap? you should ideally have one each from these two groups of if you will... the one that suits your profile and needs most. the other funds that you have selected too meet the cut. on reliance ofcourse personalfn does not have any view. with regards to midcap funds, maybe you can have a total exposure of about 10%; but you should be prepared for bigger swings in values of these funds. finally, ensure you have the right allocation between these funds.
Roy asked, I am 32 years old. I save about 10K rs. per month. I would like to have a nice bundle by the time i retire approx. at the age of 50. what plan would you suggest for me?
Rahul Goel answers, roy, hi. you have 18 yrs before you retire... if you have the appetite for risk, then you should have a predominantly equity oriented portfolio. if you continue to invest rs 10,000 pm till you retire, assuming a return of about 15%, you should be able to accumulate rs 1 crore!
syam asked, Hai Mr. Rahul, Tell me some good MF for a long run of say about 6-8 years
Rahul Goel answers, syam, hi. we will need to understand your profile and needs better before recommeding the schemes. having said that, amongs equity funds, we tend to recommend schemes like hdfc equity and fr india flexicap to our clients.
Rajeev asked, Dear Sir, I have invested Rs.45000 in HDFC Equity Fund,Rs.45000 in Franklin India Flexi Cap -G, 22500 in DSPML equity - G, 22500 in DSPL TIGER,15000 in Sundaram BNP Paribas Select MID CAP - G,I have invested this for Long Term, please suggest about my Portfolio should I continue or Quit.
Rahul Goel answers, rajeev, hi. your portfolio appears to be best suited for the tenure you are investing! well done!
moonmoon asked, Hi Rahul, My net taxable income is 169649/-. pls. advice the amount I should invest to save tax as well as the funds in which I should save to ensure maximum returns. I am 45 years old. with my present salary how much should I invest/ save annually for a secure future. Have 4 dependants on me
Rahul Goel answers, hi. i think a CA will be able to advise you best on this. however, if you do have to invest monies under section 80C, think before opting for the traditional options of ppf and life insurance. in most instances we find that in their quest to save tax investors forget that this money could have otherise achieved a lot more for them apart from just saving tax.
Malipatil asked, Hello Rahul, Last year I have invested in SBI mutual fund which give tax benefit, this year can it be safe to invest to invest in mutual funds or in some unit linked plans thanks
Rahul Goel answers, hi. in our view, if you are investing then go in for pure investments like mutual funds. if you need insurance opt for term insurance. hybrids like ulips should be taken only when you have adequate pure investment and insuranc exposure.
padam asked, Can u suggest new mutual funds to invest in 2008 so that we can get good returns. I want to invest around 1 Lakh
Rahul Goel answers, padam, hi. i think you need to make a new year resolution - "i will not invest in new fund offers"!! in personalfn's view, most nfos are just marketing initiatives... they offer little in terms of value to the investor.
ketan asked, I m 32 years old. i am getting 15 k / months. so pls sujject me , how to save money ? give some idea about finance plan for future life
Rahul Goel answers, ketan, hi. well, you need to save as much money as you can. with regards to the instruments where you money can go in, well, you probably would need to invest a considerable amount in equity oriented instruments. i am assuming here that your needs are all long term. before investing any money be sure you have access to honest recommendations. the last thing you want is to park your monies in instruments which are not the best for you.
Niranjan asked, Sir, I'm an MBA student who'll be joining the corporate in May, 2008 with a salary of Rs.50000 per month. I would like to develop a portfolio of Mutual funds (purpose of investment+tax break) . I've Rs.3.75 lakhs which i got as a deceased benefit of my father. I have Rs.2 lakhs loan (overdraft) outstanding which was availed at 9.5% p.a. Should i foreclose the loan using the proceedings or chose to invest in some better evenues. Please advice me on this
Rahul Goel answers, niranjan, hi. the answer to this would depend on how comfortable you are in keeping a liability on your books. if you are not comfortable, simply pay it off. do not worry about the opportunity loss etc etc.
syam asked, What is your opinion for appliying Reliance Powder sector MF
Rahul Goel answers, syam, hi. our view on sector/thematic funds is that these are very high risk - high return propositions which over the long term do not always create value for the investor. think tech funds in 2000. think pharma funds earlier this century.
Navin asked, I am 26 Years old. Earning 2.4 LA, expecting to 100% hike from March. I'd like to take Insurance cover. But bit of confused with ULIPs & Term Insurance. I'd chosen Reliance Automatic Invetsment Plan. My objective is to get cover till 60 Years. But I came across a Birla's Term Plan.kind of impressed. Could u help me in selecting among these two? ThanX Should i go ahead with this plan.
Rahul Goel answers, navin, hi. simply go in for a term plan. evaluate the permiums across insurers though.
Mubsy asked, What is the best plan to earn monthly income like 3k to 5k with one time investment of 1.5 to 2 lakhs..?
Rahul Goel answers, hi. it will be difficult for you to generate this kind of an income from this corpus. you will need about rs 8 lakhs of corpus, invested at about 8% pa to be able to generate about rs 5,000 pm.
Aliasgar asked, Hi I jhave 8 lacs RS to invest. Which are the possible investment options
Rahul Goel answers, ali, hi. the answer to your query will depend on many factors including your objectives, tenure of the same, risk appetite, expectation of return etc etc.
Siddharth asked, Hi Rahul i am 30 years old and want to save to pay off my housing loan of 15 lacks payable for 17 years and want to have a monthly retirement amount of 50,000. plan to retire by 55. I am investing 1000 as SIP in DSPML TIGER, Reliance Diversified Power, Tata Infrastructure, Sundaram Capex, Reliance Savings, HDFC Equity and HSBC Equity.... could you suggest me wether this portfolio is sufficient to meet my requirements. if no what else should i add.
Rahul Goel answers, siddarth, hi. to plan for your retirement needs, say 30 yrs from now, you will need to set aside rs 12,000 pm in assets earning you about 15% pa. with regards to your housing loan, by when do you want to pay it off? that will be key to any plan which will help you achieve this.
naveensethi asked, Hi Rahul, To complete the saving of Rs. 1,00,000/- i need to invest approx. Rs. 35000 more. Currently, I have one TATA AIG ULIP Plan with premium of Rs. 53000 A LIC policy with premium of Rs. 6258 A policy on the name of my kid with premium Rs. Rs. 5600. Please Suggest where should I invest the remaning part of my saving? Should I go for Mutual Fund(ELSS)? or go for another ULIP?
Rahul Goel answers, naveen, hi. you alreadly have a lot of ulips! time to start investing monies in instruments like mutual funds... in this case ELSS. i am assuming you have appetite for risk here...
sacram asked, Dear Sir, Which is best ULIP Pure Pension Plan for Retirement, I dont want to pay anything for mortality. I have taken term plan for that. Please guide me. Thanks
Rahul Goel answers, hi, if you do not want to pay anything for mortality then you want to invest the money, right? then why go for a ulip? why not a mutual fund?! you should discuss the cost implication of owning a ulips vs other investmetn products before committing any monies.
prashantk asked, hi!which is the better option for investment repay home loan principle amt or invest in mutual fund or similar investment schemes?
Rahul Goel answers, prashant, hi. if you are not comfortable with a liability on your books, simply pay off the debt. do not worry about the opportnity loss.
srinivas asked, I am Srini from Bangalore, I need to invest 1Lac for my saving and l have 35K of LIC,30K of ULIP....Would u let me know what else shal l go for so that l can get good rerurns Pls surrgest me....
Rahul Goel answers, srinivas, hi. the actual allocation would depend on several factors... i am unable to recommend anything based on the information provided by you. if you want someone frm personalfn (bangalore branch) to guide you, send in your details to
vgpal asked, Hi Rahul. Happy New Year. I'm married and my age is 29 and I'm the only bread earner. My take home monthly salary is Rs 30000. My savings till date are Rs 20000 annualy in Max Newyork Insurance Growth plan for 10 years and Rs 7000 annualy in Met Family Income Plan, for 10 years. Both since year 2006. I was not having much knowledge about investments at that time. Now I feel to enter MFs thro' SIP starting with Rs 1000 p.m as of now and slowly increasing the amount later on. I can save another Rs 3000 from April 2008. Suggest me what to do with the insurances. Also give the priorities considering my age and responsibilities. 1. Health Insurance 2. Term Insurance 3. Mutual Funds 4. PPF & other secured investment plans. Thank you in advance.
Rahul Goel answers, hi. start your sips asap! but be sure your advisor recommends to you the schemes best suited to you. with regards to insurances best you continue them till the minimum premium paying period is over. as and when more liquidity is available to you, take term insurance
on pririty.
ishu asked, dear rahul , rahul can u help me to choose term insurance for a period of 30 years keeping cost and service of claims as parameters in terms of your preferences from max , birla,sbi ,hdfc insurances .Hdfc is the costliest of all apparently .await your reply
Rahul Goel answers, ishu, hi. unfortunately i am unable to guide you on this... best is to get in touch with an insurance broker for the same. sorry!
ajju asked, hello sir, happy new year, i am having a salary of 25k and i am 29yr , i can save upto 10000 permonth, so pls guide me where should i invest, i have been deposting 20000per annum in NSC.
Rahul Goel answers, ajju, hi. you are starting early and that's great! if you have appetite for risk, and can invest for the long term, you should start your SIPs in schemes like hdfc equity and franklin flexicap. maybe before that you can download the financial planning guide from personalfn (free of cost).
somu asked, Dear sir, i'm in my 30 & take home is 17000 .. i'm having SIP with DSPML World gold fund,tata infra & Jp morgan india eq gr each of 2000 rs each.. am i in right track? pls suggest i'm planning to invest 20000 rs in JM Basic this the right time or shall i wait...
Rahul Goel answers, somu, hi. you seem to have a liking for sector funds and also nfos. i think its time for you to review your entire portfolio.
Sanjay asked, Dear Rahul, I am an NRI and I would like to know various options for investment in India. My current net savings in Rs. 150000 per month. Till now I have invested in NRI fixed deposits only.
Rahul Goel answers, sanjay, hi. well, if you are not from the US, then you have mutual funds as a key investment option in india. however, like any other market there are a lot of schemes out there, only a few of which are worth investing in. if you want, email me your details at and maybe i can direct you to the right schemes once i understand your needs and profile better.
rajiv asked, what is the best plan to earn monthly income more than expected?
Rahul Goel answers, rajiv, hi. if you want an assured income then the post office and hdfc deposits are the best. but if you can take some risk, then give the MIPs, a type of mutual fund, a try...
PrakashPatel asked, Hello sir, I want to invest Rs.42,000 in MF to save tax this year. Which is the best MF? should I go for SIP from next year and this I will invest Rs.42,000 in NSC
Rahul Goel answers, prakash, hi. we prefer schemes like franklin india tax shield. next year onwards ofcourse you can do SIPs into the tax funds.. that will be best for most investors. this year, invest in line with your long term needs.
Amit asked, I am thirty Years of Age. I have monthly inhand income of 60000. My savings are 15000 Permonth after paying Housing and Car loan (1500000) and expenses .My investment are as follows till today. 1. 25 lakh term loan Life insurance 2. reliance Natural resources IPO 100000 3. Mutual Funds 10000 each in in Reliance Growth,Sundaram BNP Paribas select Mid CAP,ICICI Prudential Real state Securities, Sundaram Energy,Uti Infrastructure Sr 1 4. Mutual Fund SIP of for DSP ML Equity(1000),DSP ML Tiger(1000),Reliance Power Diversified(1000).Standard chartered Premier equity(2000) for three Years 5. PPF 120000. Do you see my portfolio is correct and going in right directions.
Rahul Goel answers, amit, hi. you have too many schmees, and then you have mostly sectoral/thematic funds. there is a need to rationalise your portfolio... ideally one shoudl have about 6 schemes in a portfolio and not more than 10% of yoru investments in our view should be in sectoral/thematic funds.
Maneesh asked, I am an NRI, and cannot decide whether to invest in the US market or the Indian market. I want to trade on volatility i.e. short term trading. My idea is to invest in MF in India and do the short term trading in US. The reason is that I have been following the US market for the last 4 months but have not really followed the Indian market
Rahul Goel answers, maneesh, hi. pl can you download the free NRI investment guide from .... that will answer this question. sorry for taking a short cut!
Rajesh asked, good afternoon sir and very happy new year... I am 31 and planning to invest around 20K in ULIPs, please suggest the selection criteria for selecting good plan.
Rahul Goel answers, rajesh, hi. given that you are investing in ulips i assume you have completed your allocations to mutual funds and have also taken a term insurance policy. in case of ulips understand the expenses very well to begin with.
harshag asked, hello Mr.Goel, Are SIPs available for shoirt durations like quarterly or half yearly?
Rahul Goel answers, hi. i think six month sips are available as a norm... not sure if there are shorter tenures available as well.
bhasker asked, hi if i want to invest 50000 rupees on Mutual Funds what is the best way to do it.
Rahul Goel answers, bhasker, hi. the best way to do this would be to employ the services of an honest finanical planner and take his guidance. the reason i say this is because with hundreds of schemes out there, and many unscrupulous agents, you run the risk of investing in instruments which do not suit you best.
ajay asked, hi rahul what is your suggestion to put fd of 15lakh. also pl suggest some sip fr 60000pm
Rahul Goel answers, ajay, hi. since you are contemplating an FD, have you compared the post tax return with what is called a FMP (fixed maturity plan). in a lot of instances, the FMP will score better. with regards to the sip, well, if you have a high risk appetite, and are investing for the long term, invest in schemes like hdfc equity and fr india flexicap.
jag asked,  Hello Rahulji. Itis good in investing inf Infrastrucure fund.
Rahul Goel answers, hi, in our view, investors should limit their cumulative exposure to sector/thematic funds like infra funds to no more than 10% of their overall portfolio.
Harsh asked, Hello Rahul, Shall I invest in monthly SIPs or is it beneficial to invest once in a year in mutual Funds ?
Rahul Goel answers, harsh, hi. if you are salaried, then SIPs would suit you best. but if you have a lump sum to invest then you can always go in for what is called a STP - systematic transfer plan. this in our view is a preferred way of investing into equity funds as the risk of mis-timing, as compared to when you make a one time investment, is diluted.
Ajit asked, Rahul, I am 48 years old and have a monthky expenses of about 25 K with wife and two two daughters whi are studying in college. What do you think my monthly expenses will be if I retire at 55 and how much money I should save to earn that monthly income?
Rahul Goel answers, ajit, hi. assuming an inflation rate of 6%, your monthly expense would be about rs 38,000. to earn this income, you will need to have a corpus of rs 90 lakhs invested in low risk monthly income genrating instruments. to accumulate rs 90 lakhs, you need to set aside rs 60,000 pm in instruments yielding 15% pa. there seems to be a disconnect here... but this calc assumes you have no other assets.
nandakishore asked, would you please suggest me the 3 best midcap funds to invest at present
Rahul Goel answers, hi. one fund we like in this category is sundaram select midcap.
shiva asked, Why do you feel that franklin tax shied and HDFC Tax shied are good options though they are not performing well in the market...
Rahul Goel answers, shiva, hi. in recent months, the markets have moved almost unidirectionally. the more risk one took, the more returns they logged in. but going forward in our view the smarter fund manager will do well. those who take max risk, also get hit the hardest when markets fall.
sunny asked, Hi Rahul, among all my MFs I have Fidelity Equity, Franklin India Prima Plus and HDFC Equity in which I have invested on the same day and are currently giving me same returns. I had put 15000 in each of these funds. Does it make sense for me to move all my money in one among these three funds?
Rahul Goel answers, sunny, hi. the three funds that you own follow different styles of investment... all the three are good schemes to own.
Kris asked, Hi Rahul, I stay in Singapore and would like to invest in Indian mutual funds...How do i start and what should i do.
Rahul Goel answers, kris, hi. the best way to start would be to employ the service of an honest financial planner. investing is very easy in india... but to get the right advice, is very challending.
PK asked, Hi Rahul, I am returning back to Mumbai from abroad, I want to do a planning for my investment. Could you pl give me your contact add & numbers.
Rahul Goel answers, hi, you can always write in to me at
bhasker asked, I have 50000 in cash. I want to invest in Mutual Funds. What is the duration of mutual funds so that we get good returns.
Rahul Goel answers, bhasker, hi. if you are investing in equity funds, you should have an investment tenure of about 3 - 5 yrs atleast.
rithika asked, Hi Rahul, can you please suggest whether the property market will go down in the near future
Rahul Goel answers, rithika, hi. well i do not have a view on property prices per se. i would however recommend that you read the guide on real estate on personalfn -
vasanthrajc asked, Hello Rahul, New year wishes. My Question is how is the 3yr lockin period calculated for the SIP in ELSS funds?
Rahul Goel answers, hi. the lock in 3 yrs for each installment. so if the installment goes in now, this installment will be locked in for 3 yrs. the one which goes in 12 months from now, will be locked in for 3 yrs, starting 12 months from now.
rpvarma asked, Hello Mr Goel, I was blessed with grand son on 5 October 2008. I want to start saving for him. Can you please advise me where should I invest so that the same is available to him after 15 years?
Rahul Goel answers, hi. congratulations! since 15 yrs is a long time frame, you should consider investing in equity oriented investment avenues. select the instrument well as you do not want to be told to churn every now and then. it should be simply invest and track... minimal need to churn, if at all.
Rahul Goel says, Thank you all for participating in this discussion. See you all next week. In the mean time you can always write in to personalfn at

Chat with Rahul every week!

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