Which funds to invest in?

[KoolSIM]

Hello everyone,

I am planning on investing in a few mutual funds that are existing in the market. I have shortlisted a few funds and would like your help in picking a few.

Mid Cap/Small Cap (Choose 1):

- Reliance Growth
- ICICI Prudential Discovery
- DSP BR Micro Cap Reg
- HDFC Mid-Cap Opp

Large Cap/Mid Cap (Choose 1):

- HDFC Top 200
- Fidelity India Growth

Large Cap (Choose 1):

- Franklin India Blue Chip
- DSP BR Top 100 Equity Reg
- IDFC Imperial Equity Plan A

Also am planning on investing in the IDFC Infrastructure Fund NFO. What are your thoughts on this? The fund manager is the same who manages IDFC Premier A-G fund. The infrastructure sector too has been beaten down massively in the recent turbulent market! Is it a good time to invest?

Thanks in advance!

 

[asterix24]

Hi KoolSim,

Your choices are commendable. From your list, I have chosen the following

Mid & Small Cap: ICICI Pru Discovery
Large & Mid Cap: HDFC Top 200
Large Cap: DSPBR Top 100

NOTE: All your fund choices are excellent and if you feel that you can invest in more of them or all of them, it's definitely good. However, since you have mandated to choose 1, I Have chosen the above.

Coming to the NFO, I am not sure why you would want to invest into a sectoral fund. Though Infrastructure scrips have taken a beating, I don't think anyone is sure about the bottom.

I would provide few of options for you to explore:

1) Invest into a Infrastructure Bonds (IDFC, L & T, IFCI etc) which will help you for your taxes also.

2) Look for a good large cap oriented fund with a relatively high exposure to infrastructure. This will help cushion any severe correction in this sector

Happy Investing !!

 

[KoolSIM]

Thanks for the response Asterix! Well for now I'll go with three (coz I have a PPF contribution to make every month too), but I could increase that to 4 - 5 perhaps. But isn't taking too many funds, esp diversified ones like these, a case of over-diversification?

I will look into Infra-Bonds, although I was looking at the IDFC Infra Fund too on a long-term perspective. Any thoughts? An SIP in this one too! Its just for my information for now!

Thanks!

 

[suresh_786]

Hi koolsim,

I think there could not be a better time to invest in long term infrastructure funds and i think IDFC infrastructure fund seems to be pretty good avenue for investment. I understand that the sector has seen terrible times in the past, in fact to tell you the truth i myself have burnt my hands but i think one can expect better results in the near future, hence even i am giving it a thought. Infrastructure will see return of profitability and sizable reduction in balance sheet debt by all companies operating in this space. I read somewhere that infra sector is likely to give higher earnings growth compared to the average of the Nifty over the next three-four years as infra projects come on stream. There for it is a good proposition to invest in infrastructure funds such as those offered by IDFC.

I hope my reply helps

 

[xxdiesel]

IDFC Infrastructure Bonds and the Fund are two different things.

 

[savkar]

Hi KoolSim,

Your choices are commendable. From your list, I have chosen the following

Mid & Small Cap: ICICI Pru Discovery
Large & Mid Cap: HDFC Top 200
Large Cap: DSPBR Top 100

above choices are Perfect.
ICICI Pru Discovery and IDFC Premier Equity Plan A have similar performance in long term
Also check HDFC Prudence in hybrid category. stellar performance.