Suggestions requested for better investment plan.

[arroy_0209]

I have started investing in mutual funds and would like to get opinion from others regarding my portfolio. I am 33 years old and would retire from service at 60 years. Frankly, when I started investing I had little knowledge about investment and tried to invest in those funds which have given high return over last 3-5 years and carry smaller risk, as specified by one website.
My current portfolio is this: SIP in HDFC top200, HDFC prudence, HDFC taxsaver, IDFC premier euity Plan-A, Birla sunlife dividend yield plus, UTI dividend yield and SBI magnum taxgain in the ratio of 3:1:2:2:1:2:2

First of all, what is your opinion about this selection? Do you suggest any changes? I want to stay invested for at least 20 years. I am ready to accept some risk but not too much. (Also how do I "precisely" state my risk appetite?)

Second, I want to learn how to plan for investment properly. Please suggest some sources where I can learn about that.
Thanks.

 

[yodlee99]

You have good funds in your portfolio and I can make a few suggestions. Even if you don't want to change it, that's fine with me. You can read more at www.valueresearchonline.com and morningstar.co.in. Always invest using SIP on different dates of the month and check back with us every year.

Among these 7 funds, you can consolidate a little bit:
You have 3 funds under 1 management which has done a good job so far... but I am comfortable if I spread it out. You have 2 good ELSS funds and you can merge them into just 1 fund.. anyone is good enough.
You have 2 dividend yield funds both of which are good. But if you don't want the money on a regular basis, let it stay invested in equity diversified funds for interest compounding to kick in. If you still want dividends, merge these 2 into 1 fund for easy management. Birla SF dividend yield plus is a good one.
You don't need both HDFC Top 200 and Prudence as they are managed by the same fund manager and there is a good amount of overlap in the underlying stocks. You can replace it with Birla SF Frontline Equity plan A fund and DSPBR Equity.
In effect, you can consolidate within 5 funds as below:
1) Large & Mid cap funds: HDFC top200, Birla SF Frontline Equity plan A
2) Multicap fund: DSPBR Equity
3) Midcap: IDFC premier equity Plan-A
4) Dividend fund: Birla SF dividend yield plus (only if u want dividends regularly)
5) Tax-saver: HDFC taxsaver

 

[drsambu123]

I have started investing in mutual funds and would like to get opinion from others regarding my portfolio. I am 33 years old and would retire from service at 60 years. Frankly, when I started investing I had little knowledge about investment and tried to invest in those funds which have given high return over last 3-5 years and carry smaller risk, as specified by one website.
My current portfolio is this: SIP in HDFC top200, HDFC prudence, HDFC taxsaver, IDFC premier euity Plan-A, Birla sunlife dividend yield plus, UTI dividend yield and SBI magnum taxgain in the ratio of 3:1:2:2:1:2:2

First of all, what is your opinion about this selection? Do you suggest any changes? I want to stay invested for at least 20 years. I am ready to accept some risk but not too much. (Also how do I "precisely" state my risk appetite?)

Second, I want to learn how to plan for investment properly. Please suggest some sources where I can learn about that.
Thanks.

Good suggestions given by yodlee....
I would like to just mention few points.
Keep 10-20 percent in pure debt MF ... 5 % in Gold ETF.It helps to rebalance the portfolio..
Dont stop the SIP. but increase the SIP when market corrects
Read investment related articles regularly in economic times, VRO, Morningstar.com, personal finanace.com, moneycontrol.com, traderji... etc,,,,
Dont stop reading articles

 

[arroy_0209]

Thanks for the replies.
Here is one point I need to understand. What is wrong with investing in dividend yield funds? Both UTI dividend yield and BSL div yield fund have outperformed BSL FL euqity Plan-A over last three years. So in terms of return why is it not better to invest in BSL div yield fund and UTI div yield fund than in BSL FL euqity Plan-A? I can opt for growth option and in the long run, my return will be much higher than if I stay invested in BSL FL euqity Plan-A. I just need not opt for dividend payout option in my chosen fund. What is wrong with this idea?

Or is it that in longer run, say after 15 years, the BSL FL equity will outperform the dividend yield funds?

 

[jpjain2002]

dear friend,
mutual funds are not ultimate investment.their suitability rests on the purpose of investment.real grwth of funds is in either equity or in real estate we blieve,

I have started investing in mutual funds and would like to get opinion from others regarding my portfolio. I am 33 years old and would retire from service at 60 years. Frankly, when I started investing I had little knowledge about investment and tried to invest in those funds which have given high return over last 3-5 years and carry smaller risk, as specified by one website.
My current portfolio is this: SIP in HDFC top200, HDFC prudence, HDFC taxsaver, IDFC premier euity Plan-A, Birla sunlife dividend yield plus, UTI dividend yield and SBI magnum taxgain in the ratio of 3:1:2:2:1:2:2

First of all, what is your opinion about this selection? Do you suggest any changes? I want to stay invested for at least 20 years. I am ready to accept some risk but not too much. (Also how do I "precisely" state my risk appetite?)

Second, I want to learn how to plan for investment properly. Please suggest some sources where I can learn about that.
Thanks.

 

[yodlee99]

Nothing wrong with either of the BSL funds.. both are good in its own way. Dividend funds invest in companies that have larger cash flow and many are in the midcap segment. When the markets go down, the sensex/NIFTY brings down the mid, small and micro cap stocks with it. From my experience, these stock prices take longer to catch up, even if the sensex/NIFTY recovers. While it is true that the dividend fund has performed well in the last 3 years, BSL Frontline has performed very well in longer time frame (3 years +). OTOH, BSL frontline also slides less during a downfall and has recovered quickly in the past. It is ok to keep say <10% in dividend funds if you require regular returns provided you understand these risks. In that case, you have to count this as a part of your midcap allocation.
BTW, Fidelity taxsaver has performed well in the past and you can replace HDFC taxsaver with this. Wait and watch out for the new DTC rules in this regard.