Lumpsum Investment for 6 Lakhs in MFs

#1
Hello Friends,

Please suggest if the following port folio is good or not for the lumpsum investment of 1.5 Lakhs in each of the following Mutual Funds for a time horizon of 5-7 years:

1. HDFC Top 200 Fund,
2. ICICI Dynamic Fund,
3. SBI Contra Fund,
4. Reliance Equity Opportunitites Fund.

P.S.: Dear Vicky78 - Your advice 2 years back was very good and useful. Please suggest on the above question as well!! Thanks in advance!

Regards,
Nautynut!
 

yodlee99

Active Member
#2
I like most of the funds in your pick. It shows that you are making a educated choice, have a discipline to invest in equity through SIP. Among your pick
1. HDFC Top 200 Fund,
2. ICICI Dynamic Fund,
3. SBI Contra Fund,
4. Reliance Equity Opportunitites Fund.

3. SBI Contra Fund did well for some periods of its lifetime. However, things have changed and its not doing well as of now. You can instead choose 1 from DSPBR Equity or BirlaSL Frontline Equity plan-A.

Good luck!
 

simple_trader

Well-Known Member
#3
May be use market correction to enter. Even if market is in bull phase, market always give good correction to enter. Also use two three such correction to enter than in one go.

If your entry is not proper, even if you hold for 2 years, market may not give return.

There are some popular phrases in market, company may have extraordinarily good fundamental, but the price at which, we make purchase make the difference. Nothing like blind buying etc hold for 2-3 years.
 

comm4300

Well-Known Member
#4
May be use market correction to enter. Even if market is in bull phase, market always give good correction to enter. Also use two three such correction to enter than in one go.

If your entry is not proper, even if you hold for 2 years, market may not give return.

There are some popular phrases in market, company may have extraordinarily good fundamental, but the price at which, we make purchase make the difference. Nothing like blind buying etc hold for 2-3 years.
couldn't agree more....! :thumb:

thanks and :like: this comment.
 
#5
Even I am similar situation and I have following strategy based on the fact that market are high and they will correct but when is big question my guess atleast next year one such down side should come so
1. I have selected 2 best Fund house HDFC & Reliance
2. Park 3 lakh in HDFC Cash Management Savings & 3 lakh in Reliance Liquid Fund
3. When market corrects move money from HDFC Cash management into
a> HDFC Top 200 - G (Equity diversified - Large caps)
b> HDFC Prudence (Balanced - Hybrid)
& from Reliance Liquid to
c> Reliance Growth (Equity Diversified - Mid cap focus)
d> Reliance Regular saving Equity ( Equity Diversified )

4. Don't move all money in one go but over a period of 1 year as atleast 2 corrections u will get.. and if you are not patient to wait for correction you can do STP over a period of 1-2 years.

I expect after 2 years deployment of money at right time u will get good returns over a period of 5 years or more also regulary review the performance

other funds you can consider are many but u can adopt the approch only 2 fund house and 2 funds with different fund management syle .. u can include 2 more funds if required.
 
#6
I like most of the funds in your pick. It shows that you are making a educated choice, have a discipline to invest in equity through SIP. Among your pick
1. HDFC Top 200 Fund,
2. ICICI Dynamic Fund,
3. SBI Contra Fund,
4. Reliance Equity Opportunitites Fund.

3. SBI Contra Fund did well for some periods of its lifetime. However, things have changed and its not doing well as of now. You can instead choose 1 from DSPBR Equity or BirlaSL Frontline Equity plan-A.

Good luck!
Hello yodlee99,

Thanks for the reply. I appreciate it.

Would you believe that the SBI Contra Fund will not do well in the time horizon of 5-7 years? Though I am not a very big fan of this fund but I thought that this fund will have some stability to my portfolio for lumpsum investment. Appreciate your response in advance.

Would you be able to also let me know how is ICICI Discovery Fund for my portfolio instead of SBI Contra Fund? Are 2 MFs of ICICI recommended in the same portfolio? Else I am happy to go with DSPBR Equity.

Thanks for your time.

Regards,

Nautynut!
 

yodlee99

Active Member
#7
Hey Nautynut, If you are looking for some stability in your portfolio keep 60%+ in large cap funds. Good that you have HDFC Top 200 (managed well since inception by Prashant Jain) and also ICICI Dynamic. You can include Reliance Regular savings equity as well.

As the name Contra is a short form of "contradictory", they pick stocks that they see are low which could raise. However, it is not consistent and has eventually fell out of flavour. One could never predict what could happen to it in the future, maybe it will perform, but I won't bet my money on it, to be frank. It has just 3-star ranking from valueresearch and has low alpha value:
http://valueresearchonline.com/funds/fundanalysis.asp?schemecode=633

Instead go with Reliance Growth or ICICI Discovery, which invest midcap & smallcap companies and are both very good. If you think you already have a fund under these 2 AMCs, then IDFC Premier Equity -A is another good pick. Remember that midcap & smallcap are volatile, highrisk/highreturn bets and I have suggested the best ones in this sector. If the market tanks, they would too, no doubt. Don't have more than 20% of your portfolio in such midcap & smallcap funds. However, these are better earners too, in a growing market like ours.
 
#8
Hey Nautynut, If you are looking for some stability in your portfolio keep 60%+ in large cap funds. Good that you have HDFC Top 200 (managed well since inception by Prashant Jain) and also ICICI Dynamic. You can include Reliance Regular savings equity as well.

As the name Contra is a short form of "contradictory", they pick stocks that they see are low which could raise. However, it is not consistent and has eventually fell out of flavour. One could never predict what could happen to it in the future, maybe it will perform, but I won't bet my money on it, to be frank. It has just 3-star ranking from valueresearch and has low alpha value:
http://valueresearchonline.com/funds/fundanalysis.asp?schemecode=633

Instead go with Reliance Growth or ICICI Discovery, which invest midcap & smallcap companies and are both very good. If you think you already have a fund under these 2 AMCs, then IDFC Premier Equity -A is another good pick. Remember that midcap & smallcap are volatile, highrisk/highreturn bets and I have suggested the best ones in this sector. If the market tanks, they would too, no doubt. Don't have more than 20% of your portfolio in such midcap & smallcap funds. However, these are better earners too, in a growing market like ours.
Hello yodlee99,

Thanks for the reply.

I will think once over on the options of taking IDFC Premier Equity Plan-A and ICICI Prudential Dynamic. However as of now I will freeze on:

1. HDFC Top 200
2. ICICI Prudential Discovery
3. DSPBR Equity
4. Reliance Equity Opportunities

Please feel free to suggest if you have anything else up the sleeve! Thanks a ton!:) You rock!

Regards,
Nautynut!
 

yodlee99

Active Member
#9
Hey, all these are good funds.

Do you know how to use the "Funds Compare" research tool with valueresearchonline? Learn it as it that comes very handy.
I created one for you to check:
http://www.valueresearchonline.com/...ct1=104&select1=393&select1=2310&select1=2640

You have 3 out of 4 funds (all except HDFC top 200) that are oriented towards midcap & small cap stocks. Remember, when markets go down, it drags with it all these mid & small cap stocks and mutual funds invested in them. As I said before, if you want to have 4 funds, take 2 in large-cap, 1 in multi-cap or a balanced fund and at max, 1 in the mid & small cap segment.

I would say, try and reallocate these. Pick up
1) HDFC Top 200 and 2) DSPBR Top 100 for a large-cap tilt.
3) You can pick a multi-cap pick like Reliance Regular savings equity. Other option is a balanced once like HDFC Prudence that would provide stability.
4) Mid & small cap: Reliance Growth, IDFC Premier equity plan A or ICICI Discovery.

Input these in valueresearch "Funds compare" tool and see what it says.
 
#10
Hey, all these are good funds.

Do you know how to use the "Funds Compare" research tool with valueresearchonline? Learn it as it that comes very handy.
I created one for you to check:
http://www.valueresearchonline.com/...ct1=104&select1=393&select1=2310&select1=2640

You have 3 out of 4 funds (all except HDFC top 200) that are oriented towards midcap & small cap stocks. Remember, when markets go down, it drags with it all these mid & small cap stocks and mutual funds invested in them. As I said before, if you want to have 4 funds, take 2 in large-cap, 1 in multi-cap or a balanced fund and at max, 1 in the mid & small cap segment.

I would say, try and reallocate these. Pick up
1) HDFC Top 200 and 2) DSPBR Top 100 for a large-cap tilt.
3) You can pick a multi-cap pick like Reliance Regular savings equity. Other option is a balanced once like HDFC Prudence that would provide stability.
4) Mid & small cap: Reliance Growth, IDFC Premier equity plan A or ICICI Discovery.

Input these in valueresearch "Funds compare" tool and see what it says.
Hey yodlee99,

Thanks so much for the help.

As suggested, I did use the fund compare tool and will go ahead with the following:

1. HDFC Top 200
2. DSPBR Top 100
3. ICICI Prudential Discovery
4. Yet to Finalize between HDFC Prudence and Reliance Regular Savings Equity

Do you think the markets will fall so much in the next few years that it would be not so ideal to go with 2 smallcap/midcap size funds in my portfolio. Else, I would think of keeping the 4th slot for either IDFC Premier Equity Plan A or Reliance Equity Opportunities Fund. I know its difficult to predict, but require your able advice. Sorry for troubling you so much in last few days.

Thanks!

Regards,
Nautynut!