Guidance on Mutual Fund SIP Portfolio

Dear all,
I am Adarsh and of 40 years now.
I started SIP 2 to 3 years back and have some funds but need advice if all my SIP Funds are good enough to yield me good returns as I will invest for another 18 years.
Please advice on the balance of different type of funds I should have as SIP. Please guide. also advice on the amount I should have for these SIP as my intent is to have atleast 2 crore by next 18 yrs

You need to invest 40000 monthly at 9%cagr for 18 years to get 2cr.
You can omit the sectoral fund (bank and finance) with high expense ratio.
Change from regular to direct plan and save on commission.
If possible add lumpsum when portfolio is down to boost returns.

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All are good fund but it’s not required more than one fund on each large mid and small… I saw almost similar type of fund you chosen . Cutdown to one Fund Each large mid and small cap you may save fund expenses and switch to Direct plan…

  • SBI Bluechip Fund .
  • Aditya Birla Sun Life Tax Relief 96.
  • SBI Small Cap Fund.
  • ICICI Prudential Bluechip Fund .
  • Canara Robeco Bluechip Equity Fund.
  • Kotak Emerging Equity Fund.
  • Mirae Asset Tax Saver Fund.
  • Tata India Tax Savings Fund.

These offer the best SIP options to invest in.
You need to invest atleast 1000 daily to get a return of 2 crore after 20 years

Thanks Akash…so I should take out Icici banking and financial SIP… agreed
I have no idea about regular to direct plan change. What is it and how to do it?

Thanks Abdul… that isbthe advice I want as I have less idea.
Please advice on 1 type of each fund to keep

Thanks Raghav. I am investing 50000 per month on my SIP but need you to tell if these funds are ok. I see you listed entirely new funds. Plz advice how many and what from your pick and my pick k should keep SIP and how much I should keep increasing per mongh

Well I don’t but seeing the hard earned money of innocent individual is involved i can’t resist. Please don’t invest in MF. Reasons are many but one thing is that when you are the member at VP forum where so many stock investing ideas are discussed then you should put effort in learning and then invest.

Inspite of this if you are hell bent on giving free cheques to fund manager then invest in index fund directly. You will not repent. Please don’t fall prey to the marketing gimmicks and arithmetic calculation of 1 crore in 10 years with x% cagr. Phew… All such forecasting never works in real life scenarios.

Happy investing.
VK

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If you have belief in the overall direction of the India story, it makes sense to do SIP in index funds - at least we will not be at the mercy of fund manager. Otherwise, it is better to stock SIPs / go with solutions such as smallcase or similar.

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It’s nice that you have an uncluttered set of good funds and disciplined SIP plan for the long term. Also, the overlap between multiple funds is <25%, which is good. I am sure you have put in a lot of thought before selecting these funds. Only generic feedback from my MF experience is…

  • Please switch to direct funds instead of the regular ones. Over the long term, it will make a difference in returns. Returns & corpus lost to commissions in regular plan mutual funds
  • Please consider increasing your SIP as the corpus grows. Increase your SIP amount periodically.
  • Please have an asset allocation plan (if not already done) and change it as you achieve milestones. Currently, your portfolio is all in equity. As the corpus grows, please have a plan to increase debt portion to safeguard from market crashes What is the importance of asset allocation…
  • [Minor] Looks like some of your funds have a high expense ratio (for e.g. SBI Large & Midcap has TER 2.05%. You could keep a watch on the performance and see if the fund manager can justify the high TER.
  • There are many articles which summarize (with lots of past data) that active equity funds are finding it difficult to beat the index in the long run. You can just search and convince yourself if index funds/ETFs in your cup of tea.

I would say better asset allocation plan like allocate Higher share Large cap MF 60% mid 20% small20%.Focus on saving and strict with SIP on monthly. Don’t see return Or NAV every day. I would suggest you to visit freefincall YouTube channel or blog… He covers variety of MF topics in his post.

Dear Sir,

Its good that you are investing in MFs with a long term view. One thing that will make you achieve your target is being invested without any panic for 18 years. Even if recession comes, go more heavy. Never be afraid . India is huge growth story. So never stop SIP in corrections . In fact put lump sum during corrections. Always keep some money aside to utilize situation like March 2020. Now coming to funds, I would suggest to not invest in sectoral funds(especially Banking and finance) . In your list of funds I like only Mirae Asset Emerging Fund( I am not talking based on past performance. My view is seeing future) . Few funds I would suggest -
1- Mirae Asset Tax Saver
2- Parag Parikh long term equity fund
3- Canara Rebeco Bluechip fund
If you want sectoral fund, go with
Mirae Asset Healthcare fund.

These 3-4will serve the purpose.

Also don’t invest in Regular funds. Go with direct fund. I see that you don’t know about regular and direct funds. In simple terms , direct funds give more returns as compared to regular by saving commission. When you search a mutual fund , there will be 2 options - Regular and Direct. Choose direct.
You will do great.

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You must have bought mutual funds on the advise of a distributor eg. Bank relationship manager, personal finance advisor, agent etc. The funds suggested by them are called regular as they include commission in the expense ratio.
You can buy mutual funds directly from the AMC by visiting their website or by new app like coin, grow etc.

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Thanks @lsubs
I am.seriously thinking to buy SIP from AMC directly and move out of icici direct.
I need suggestions like equity fund these are good keep 1…debt dund these are good keep 1 etc …like this type of handholding as I feel my money is going nowhere with my current choise.
So plz advice funds from different types of fu ds to be safe and yet get profit in long run and also how much I should do SIP for those funds

You have clearly indicated that your investment journey is going to be 18 years long. Schemes have their ups and downs due to various reasons like Fund Manager changes, Portfolio Churn, Good/Bad Portfolio Bets etc. What is a excellent scheme today may not remain so after 5 years. Also, after some time, even good performing schemes may no longer fit your asset allocation and have to be removed.

Over the years, my approach has been to look at the following aspects of the schemes in my portfolio every 6-months and rebalance accordingly…

  • What is the narrative for investing in this fund? How does it fit the asset allocation?
  • What are the characteristics of the scheme…
    • Quick Portfolio check
      • Composition of Giant/Large/Mid/Small companies in portfolio and a quick scan of top holdings (Concentration) in the portfolio
      • Credit Rating of portfolio of debt funds
    • Risk Measures - Mainly Alpha, Beta for equity funds. YTM, Modified Duration and Average Maturity for debt funds
    • Rolling & Trailing Returns over 5/7/10 years
    • TER
    • Quick check of AUM, Fund Manager Continuation, VR/MorningStar ratings/reviews

For example: In the Multicap space, you have selected Motilal Multicap 35. Comparing that with PPFAS Long Term Equity in the same category

Motilal Multicap 35 PPFAS Long Term Equity Notes
Portfolio Check 66% in Giant+Large and 23% in Mid 66% in Giant+Large and 23% in Mid Similar in portfolio characterestics
Risk Measures Alpha - -4.5, Beta - .96 Alpha - 7.48, Beta - .78 PPFAS has better at generating alpha with a lower beta. This could be due to the exposure to international stocks.
Rolling Retuns (5y) 0% ~ 10% - 35%
10% ~ 20% - 60%
20% ~ 30% - 3%
0% ~ 10% - 21%
10% ~ 20% - 78%
20% ~ 30% - 0%
Motilal fund is 5 years old. So, 7y and 10y rolling returns is not available. With this data, PPFAS seems better
Trailing Returns Best 1y - 66%
Worst 1y - -31%
Best 1y - 53%
Worst 1y - -21%
This correlates with the risk metrics and rolling returns numbers. PPFAS has lesser volatility and drawdown
TER 1.80% 2% Being active funds, both are on the higher end
Ratings/Reviews ValueResearch rating - 3 star ValueResearch rating - 5 star PPFAS AGM recording is availble at Live Stream AGM - Unitholders’ Meet. There is very good transparency and the investor reviews are very positive too.

Similarly, you can compare the following

  • HDFC Midcap with L&T Midcap, DSP Midcap
  • SBI Large and Midcap with Mirae Emerging Bluechip
  • Motilal Multicap 35 and Franklin Focused with PPFAS Long Term and Axis Focused 25
  • In general, all the above with any Nifty and Nifty Next 50 Index Fund

Instead of suggesting funds, I have just shared my approach. You can leverage the collective wisdom of this excellent forum and come up with your own approach. That will help you with your journey in the long term…

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my 2 cents for mutual funds , first read common sense of investing by john bogle recommended by warren buffet sir, you must open acount by yourself on cams / mf utility.com , pls dont go for any other platform its once lifetime process only one time,than you can do all things at their apps, now come to your answer about mutual funds,
CHECKLIST
1.low expense ratio
2. direct fund
3. reputated amc fund house
4. if found fund manager also invested in his fund which he operates.

1.sensex direct index fund.
2.next nifty direct index fund.
3. parag parikh long term fund.
i think 3 fund is more than enough to build your better future portfolio.

disclosure: i m not sebi registered fund manager or financial advisor

Thank you all.
i have closed my HDFC midcap fund and opened sbi small cap direct plan.

I have also closed icici prudential banking and financial fund.

I have moved mirae asset emerging bluechip to a direct plan.

I will close sbi mid and large cap and will take PPFAS LOnG TERM EQUITY direct plan.

I need advice on which Index fund to go for.

also for Motilal Oswal shall I keep it or exchange with another fund like Motilal Oswal Nasdaq 100 fund??

Please advice

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In my honest opinion, ICICI or UTI Index funds have been tested through the times, so you can go for either. In the end, these are passive funds. I’m not invested in them with these fund House, and doing with different fund.

Regards, SA

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I think you don’t required index fund because already investing in one large cap BLUECHIP Fund. It’s almost similar to index but actively managed fund.
No need too many fund. I’m investing in UTI index fund And one Multicap PPFA fund … keep it simple… focus accumulating more MF units. One need to remember last couple of yrs. mid and small cap fund returns very bad . If it’s start correcting you can’t stop… one need Patient and risk tolerance …

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Agreed. SBI small cap has been decent enough though.

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