I had invested a lump sum in PPFAS liquid fund, whereby the money gets transferred to flexi-cap funds through STP. The entire money will be transferred in 30 instalments. However, I am concerned about the opportunity cost of not keeping money in debt funds. Should I transfer my funds to a . Should I move to? Conservative Hybrid Fund and then start Please For a flexi-cap or should I just leave it as it is?

Rushabh Desai, Founder, Rushabh Investment Services, replied: Conservative hybrid funds invest 10-25% in equity instruments. As per historical data, this category has witnessed negative returns on a rolling return basis. Here the maturity profile of the debt component may not remain constant and may not match your horizon. Also, these funds can venture into low credit instruments which can be risky. This range can face volatility and can affect your STP amount. The minimum horizon for this category should be around 3-5 years. Keeping these things in mind, I would not suggest that you shift your funds in this category. Since your STP time frame is short and your main goal is to invest in equities, the opportunity cost on the debt side should not be your primary concern. On the other hand, since you have lump sum money in a liquid fund, you can think of pocketing this corpus with good correction over a period of 30 months and shorten your STP time frame. This way you will be able to earn higher returns than equity in the long run. If you do not know when and how to time the equity market, you can systematically invest in equities through the STP route. Since we will soon see a rate hike cycle and this will impact the returns of many debt funds, I suggest you stick with liquid, short tenure and arbitrage funds. Out of your 30 monthly STP installments, you can leave the corpus in your liquid fund for the first 15 months and the rest in high credit quality short duration funds and arbitrage funds. At the end of your initial 15 monthly STP installment tenure, you can redeem your existing Liquid Funds and invest back. This way you can get slightly higher returns than the liquid category. Please be aware that execution can be difficult. If you do not understand this and cannot manage it, it will be more convenient and less risky to stay in your liquid fund.

I am a retired person with monthly income of Rs.50,000. After the expenses, I invest Rs 10,000 through SIP in Mirae Asset Large Cap Fund. In addition, I have shares worth Rs 1 lakh in HUL and Asian Paints. Now, I can save another Rs 5,000 per month for investment. Would you recommend me to invest in stocks directly or add it to my existing SIP?

Praleen Bajpai, Founder, Finfix® Research & Analytics, replies: There is no information regarding the risk appetite, time frame or other investments in your portfolio. than to buy direct stock, mutual funds A more convenient and hassle free vehicle to hold a diversified pool of stock. Although the choice of plan should ideally be done after reviewing your overall portfolio, depending on the plan and stocks and the fact that you are a retiree, an additional investment of Rs 5,000 per month in a plan from Aggressive Hybrid can be done. Category. As per SEBI guidelines, aggressive hybrid category funds are required to invest around 65-80% in equities, while 20-35% in debt and money market instruments. These funds regularly rebalance their allocations within these limits based on market conditions and can moderate downside risk to some extent during sharp market corrections. This category is suitable for investment horizon of five years and above. However, if you are looking for pure equity investment, you can increase your allocation in existing large-cap funds.