Comments Please

[sumapathi]

Hello Investors,

I have recently come into some money and would like to invest in mutual funds:

These are the funds i am looking at:

Templeton India Growth Fund INR 10,00,000
ICICI Prudential Discovery Fund - IP INR 10,00,000
Birla Sun Life Mid Cap Fund - Plan A INR 5,00,000
Principal Emerging Bluechip Fund INR 5,00,000
Reliance Regular Savings Fund - Balanced INR 5,00,000
Templeton India Equity Income Fund INR 5,00,000
Reliance Equity Opportunities Fund INR 5,00,000
SBI Magnum Sector Umbrella - Emerging Businesses Fund INR 5,00,000

I do not want to go to each mutual fund website and register myself and purchase my funds, i would prefer to purchase and monitor these funds in one place, i currently bank thru SBI,

can anyone suggest the best place where i can buy all these funds and monitor the same over time?

Please let me know if my question is not clear.

 

[rajenderballa]

You can choose either HDFC or ICICI Direct account and transact online at one place.

 

[nikrod]

My advice would be to invest via SIP / STP route and spread your investments over 12 to 18 months. DO NOT invest the amount in one go. You may use ICICI Direct or HDFC ISA account.

about the fund selection: You have choosen 8 funds. This will give over diversify your portfolio. Keep your choice limited to 6 funds.

My second observation is that out of the funds selected by you, 4 are mid cap oriented, 2 aggressive & 1 sector fund. This would make your portfolio risky & volatile in nature. Kindly note that in bear run of 2008, mid cap / small cap funds lost from 60 to 75% of their value. you should always have right Large-mid cap allocation inyour portfolio.

Do let us know if you want to find good funds to create portfolio with proper risk - return balance. Experts here will be able to help you.

 

[sumapathi]

My advice would be to invest via SIP / STP route and spread your investments over 12 to 18 months. DO NOT invest the amount in one go. You may use ICICI Direct or HDFC ISA account.

about the fund selection: You have choosen 8 funds. This will give over diversify your portfolio. Keep your choice limited to 6 funds.

My second observation is that out of the funds selected by you, 4 are mid cap oriented, 2 aggressive & 1 sector fund. This would make your portfolio risky & volatile in nature. Kindly note that in bear run of 2008, mid cap / small cap funds lost from 60 to 75% of their value. you should always have right Large-mid cap allocation inyour portfolio.

Do let us know if you want to find good funds to create portfolio with proper risk - return balance. Experts here will be able to help you.

thank you for your excellent advice, could you give me your reasoning behind why it is better to use a SIP rather than investing one lumpsum amount. Would it not be better to wait to see a favorable NAV price and invest fully in the fund.

 

[sumapathi]

My advice would be to invest via SIP / STP route and spread your investments over 12 to 18 months. DO NOT invest the amount in one go. You may use ICICI Direct or HDFC ISA account.

about the fund selection: You have choosen 8 funds. This will give over diversify your portfolio. Keep your choice limited to 6 funds.

My second observation is that out of the funds selected by you, 4 are mid cap oriented, 2 aggressive & 1 sector fund. This would make your portfolio risky & volatile in nature. Kindly note that in bear run of 2008, mid cap / small cap funds lost from 60 to 75% of their value. you should always have right Large-mid cap allocation inyour portfolio.

Do let us know if you want to find good funds to create portfolio with proper risk - return balance. Experts here will be able to help you.

Nikrod, i wanted to send you a private message, but that seems to be blocked for you account.......

 

[nikrod]

thank you for your excellent advice, could you give me your reasoning behind why it is better to use a SIP rather than investing one lumpsum amount. Would it not be better to wait to see a favorable NAV price and invest fully in the fund.

SIP is investment strategy that enables you to forget market timing & invest with discipline & regularity. SIP will average your cost of purchasing mutual fund units.

The problem with common investors is trying to time the market. How would you determine the favorable NAV? for example if you would have invested in December 2007 or Jan 2008 when Sensex was at 20-21k levels, your lumpsum investment would still be in Red. And very few people predicted the bear market at that time. On the opposite side if you would have started SIP even at 21k Sensex levels, you would be in profit today.

This is point of SIP. Do not try to time the market. Mutual funds are not like stocks where you can at least get the feel about favorable price after detailed analysis.

PS - I have turned the private messages on. You can send me one now.