I am 51 year old retired unmarried woman. I have Rs 60 lakh in PPF, Rs 12 lakh in tax free bonds, Rs 1.25 crore in bank deposits, Rs 93 lakh in shares and Rs 89 lakh in mutual funds. Shares are in Asian Paints (1,400 shares), RIL (424) and TCS (136). my mutual fund portfolio These include Axis Bluechip (Rs 8.38 lakh), Kotak Flexicap (Rs 14.74 lakh), Mirae Asset Emerging Bluechip (Rs 2.77 lakh), Mirae Asset Hybrid Equity (Rs 3.02 lakh), Mirae Asset Large Cap (Rs 7.40 lakh), Parag Parikh Flexicap. Are included. (Rs 59,000), ABSL Corporate Bond (Rs 3.73 lakh), ABSL Savings Fund (Rs 13.60 lakh), Kotak Savings Fund (Rs 13.43 lakh), SBI Magnum Ultra Short Duration (Rs 18.12 lakh) and ABSL Liquid (Rs 3.29 lakh) . Currently, there is only one SIP of Rs 5,000 in Mirae Asset Emerging Bluechip. Is my portfolio suitable for long term Investment? I can invest Rs 30,000 every month. Please suggest alternatives.
Naveen Kukreja, CEO and Co-Founder, Paisabazaar.com replies: Your total investment portfolio is Rs 3.8 crore, of which about a third is in stocks and other equity related instruments and the rest in fixed income instruments. I am assuming that you have a source of income to get investable surplus of Rs.30,000 after meeting expenses. You don’t need to dip into existing investments to sustain your post-retirement expenses. My first suggestion would be to continuously increase the equity allocation to 50-60% of your total portfolio keeping in mind the risk appetite and time frame. I also suggest that you shift your direct stock exposure to equity mutual funds if you do not have the expertise to buy and sell on your own. Continue your existing investments in Axis Bluechip, Mirae Asset Emerging Bluechip, Mirae Asset Hybrid Equity, Mirae Asset Large Cap, Parag Parikh Flexicap and Aditya Birla Sun Life Corporate Bond Fund. You can transfer your investment in Kotak Flexicap to Parag Parikh Flexicap Fund as the past performance has been consistently poor. I would also suggest that you continue with your existing SIP in Mirae Asset Emerging Bluechip, while the rest of your monthly investable surplus can be invested in either of these two large cap index funds – Tata Index Sensex or HDFC Index Sensex Fund – Tenure through SIP of 1 year. If your income is taxable, you can invest in Mirae Asset Tax Saver and/or Axis Long Term Equity Fund through SIP to save income tax under section 80C. I suggest you park your emergency fund in bank deposits offering interest rates above 6% p.a., bank deposits, ultra short duration funds and liquid funds to short the rest of your holdings to generate higher returns Should be transferred to Duration Debt Fund. You can consider ICICI Prudential Short Term and HDFC Short Term Debt Funds.
I am 26 years old, unmarried and earn Rs 25,000 per month. I want to invest Rs 1,000 per month in mutual funds through SIP. I am paying EMI of Rs 15,000 for education loan and also paying premium of Rs 20,000 annually for LIC policy. Me too Investment 1,000 per month in PPF. Please suggest the funds in which I can invest. My investment horizon is 15 years.
Vidya Bala, Co-Founder, PrimeInvestor.in replies: First of all, we would like you to understand what kind of insurance policy you have taken. If it’s pure life insurance, fine. But they usually come with a low premium. if it’s a Pennies Back, there is a high probability that this is an option with low returns. Please see if you need it now. Otherwise, give priority to PPF over it. At Rs 1,000 per month, go with a simple index fund like UTI Nifty 50 Index Plan. You won’t need to be actively tracked for this. You can gradually increase the investment as your savings increase.