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Are these mutual funds making you MONEY?

Wondering if you did the right thing with your mutual fund investments?

Omkeshwar Singh, Head, Rank MF, a mutual fund investment platform, will answer your queries.

If you want his advice on your mutual fund investments, please mail your questions to [email protected] with the subject line, ‘Mutual Fund Query’, along with your name, and Omkeshwar will offer his unbiased views.

Subramaniam A K: I have invested the following mutual funds in the year 2018. Would like to have your opinion whether I can still continue in the scheme or shift to some other scheme? Also would like to know the reason for the same.

Omkeshwar Singh:

Top 2 Equity value funds are (4-Star rated)

  • Tata Equity PE fund
  • UTI value opportunity funds

Ather Masood: Greetings! Am 49 years, I have the following on going SIPS. Kindly advise me if I should continue or switch.

Omkeshwar Singh:

Axis and Kotak schemes can be continued.

Top 2 small cap funds are (4-Star rated)

  • Kotak Small Cap Fund
  • Axis Small cap fund

Nandkumar Patil: Details of my mutual fund portfolio are as under:

Omkeshwar Singh:

All 5 and 4 star rated funds can be continued, rest can be replaced by the funds below in their respective categories.

Large cap: Suitable option considering quality and value for money at present levels is Mirae Asset Large Cap Fund

Large and Midcap: Suitable option considering quality and value for money at present levels is Kotak Equity opportunity.

Midcap: Suitable option considering quality and value for money at present levels is DSP Midcap and Axis Midcap

Multicap: Suitable options considering quality and value for money at present levels are UTI Equity Fund, Axis Multicap, Motilal Oswal Multicap 35

Focused: Suitable options considering quality and value for money at present levels are Axis Focused 25 and Motilal Oswal Focused 25

Small cap: Suitable options considering quality and value for money at present levels are Kotak Small Cap and Axis Small Cap

Saurabh Kumar: I’ve just started investing in mutual funds by way of SIP after consulting a financial advisor. Just wanted to ask something out of curiosity. These days wherever I see everybody has invested in mutual funds in the hope to earn millions. So maybe after 10 or 20 years we’ll have so many millionaires everywhere if really mutual funds give such returns. If no that means mutual funds don’t give such high returns. So maybe then it’s all just a hoax that everybody is chasing. Please guide.

Omkeshwar Singh: Selection or right category and right funds can create wealth due to power of average equity fund returns and power of miracle of compounding. Incorrect selection of category and the scheme can also lead to underperformance or loss therefore selection of schemes is of paramount importance

If we look at the Sensex returns from its existence in 1979, the CAGR has been 14.5 per cent.

Illustration of corpus creation is as under*:

Corpus that can be created in 30 years @14 per cent

Corpus that can be created by 15-15-15 (Rs 15,000 monthly SIPs for 15 years @ 15 per cent)

If same done with recurring deposit, the corpus would be Rs, 44 lakh only

Corpus that can be created in 25 years @ 15 per cent

If done with recurring deposit, the corpus would be Rs 18 lakh only.

Laiq Ahmad: I am investing SIP from around last 3 years in the following funds:

1) Baroda Multi Cap Fund

2) Baroda Mid-Cap Fund 

After reviewing from so many months I am observing that the current amount which is coming out is less than the invested amount.

Kindly advise if I should continue my SIP or hold it or finish it off? I would appreciate your valuable comments.

Omkeshwar Singh:

Multicap: Suitable options considering quality and value for money at present levels are UTI Equity Fund, Axis Multicap and Motilal Oswal Multicap 35

Midcap: Suitable options considering quality and value for money at present levels are Motilal Oswal Midcap 30, DSP Midcap and  Axis Midcap

Chetan V: My son has joined sWC for CA article-ship. He is 20 years old. He is getting a stipend of Rs 10,000. As I am giving money for his livelihood, he wishes to save a part of earnings in mutual funds. Kindly advice about the right amount of money to save and also which are the ideal funds to start a SIP?

Omkeshwar Singh: There is a thumb rule of 50:15:5, that is, of the total net monthly earnings, 50 per cent for livelihood; 15 per cent to be invested for retirement; and 5 per cent to be invested for emergencies.

Remaining 30 per cent can be used either for investment or expenditure.

Since you are taking care of your son’s livelihood, therefore 65 per cent or Rs 6,500 should be invested for long term or equity funds and remaining amount can be invested in liquid funds.

Chandni Jain: I want to start investing in equity mutual funds for my retirement. Right now I am 30. Can you suggest best equity mutual funds for the purpose?

Omkeshwar Singh: Below are few categories and fund that can be considered for creating corpus for retirement . You may also create a basket of these funds

Multicap: Suitable options considering quality and value for money at present levels are UTI Equity Fund, Axis Multicap and Motilal Oswal Multicap 35

Focused: Suitable options considering quality and value for money at present levels are Axis Focused 25 and Motilal Oswal Focused 25

Midcap: Suitable options considering quality and value for money at present levels are Motilal Oswal Midcap 30, DSP Midcap and Axis Midcap

Vijay Patil: I am working in an Indian IT MNC. I want your guidance and review on my mutual fund portfolio. I am investing since Jan 2016 in following 2 mutual funds monthly with goals of long term corpus.

  • Kotak Emerging Equity Growth: 3000
  • SBI Magnum Midcap Fund Growth: 2000

Kindly provide your guidance if I should continue investing same or need to change anything. Please suggest good funds in case I need to revisit or modify my portfolio accordingly.

Omkeshwar Singh:

These funds are also good. However, you may also consider the top-rated funds in this category:

Midcap: Suitable options considering quality and value for money at present levels are Motilal Oswal Midcap 30, DSP Midcap and Axis Midcap

Tathagata Chakraborty: I am a fresher got job this year with earning of 17k per month. As I stay with parents I save 80 per cent of my salary. I invest Rs 5,000 pm in PPF account, and Rs 4,000 in RD, rest Rs 3,000 I invest in mutual fund. These are following funds I invest in. All are direct growth:

1. Nippon Gilt Securities Fund

2. SBI Magnum Constant Maturity Fund

3. SBI Magnum Multicap Fund

4. ICICI Liquid Fund

5. DSP Liquid Fund

6. Motilal Oswal Large and Midcap Fund

7. Axis Long Term Equity Fund

8. Axis Bluechip Fund

I have some questions:

1. Please let me know if these are good funds.

2. Will I be able to prove to my friend that MF is good if I invest these for 3 years?

3. If any changes are there please suggest.

Omkeshwar Singh:

You may continue with these funds.

Preeti Prasanna: I HAVE MONTHLY SIPS AS FOLLOWS

(1) PARAG PAREKH LONG TERM EQUITY FUND – 5000 PER MONTH (since @ 2years )
(2) ICICI PRU US BLUECHIP FUND – 3000 PER MONTH (since @ 1 year)
(3) SBI SMALL CAP FUND – 3000 PER MONTH ( Since @ 1.5 year)
(4) HDFC MIDCAP OPPORTUNITY FUND – 2000 PER MONTH ( Since @1.5 year)

Also earlier holdings in:

(1) Motilal Oswal Focused 35 fund
(2) L&T Emerging Equity Fund
(3) Axis Long Term Equity Fund

Kindly advise for restructuring the portfolio with horizon of 5 years

Omkeshwar Singh:

Midcaps and small caps may require changes, rest are fine.

Midcap: Suitable options considering quality and value for money at present levels are Motilal Oswal Midcap 30, DSP Midcap and Axis Midcap

Small cap: Suitable options considering quality and value for money at present levels are Kotak Small Cap and Axis Small Cap

Arindam Pramanik: I want to invest Rs 10,000 month SIP. Kindly suggest the mutual fund where to invest next 5 years for better returns.

Omkeshwar Singh: Below are few categories and funds that can be considered for next 5 years. You may also create a basket of these funds

Multicap: Suitable options considering quality and value for money at present levels are UTI Equity Fund, Axis Multicap and Motilal Oswal Multicap 35

Focused: Suitable options considering quality and value for money at present levels are Axis Focused 25 and Motilal Oswal Focused 25

Midcap: Suitable options considering quality and value for money at present levels are Motilal Oswal Midcap 30, DSP Midcap and  Axis Midcap

Rajagopal Janakiraman: Here are my questions:

(1) From AY 2018/19 dividends from equity oriented mf are subject to Dividend Distribution Tax @11.648 per cent and this has hugely affected the return on mf. Investors whose gross total income is within exempt limit are forced to pay tax indirectly by way of DDT. Incomes such as interest are not subjected to this kind of levy. DDT is harsh and hurting investors. Better to tax it as income from other sources and also capital gains at slab rates. Whether MF companies have taken this matter with finance ministry? There is no level playing field between growth and dividend funds and DDT has put growth funds tax advantage.

Omkeshwar Singh: No Comments

(2) Crash of stocks of banking companies have hurt investors, particularly those holding Yes Bank and LVB. Prior to rights issue LVB was selling @ 177 and rights issue was for 122. Now the scrip is selling @ 15. Investors have lost hugely their hard earned money. Subsequent to rights issue, LVB made fresh disclosures of NPA that lead to further fall and the scrip has further declined is selling at 10 per cent price before rights issue. SEBI and RBI have not protected the interests of investors. They should have annulled the rights issue and asked the bank to return the money raised in rights issue. What is the remedy for investors?

Omkeshwar Singh: No Comments

(3) What is your advice on these funds? Buy/hold/sell? How good are infrastructure funds?

(4) Is it better to sell SBI Magnum Tax Gain Dividend payout and invest in Tata India Savings Fund dividend payout?

Omkeshwar Singh: You may continue with the 4 star rated funds. Sectoral Funds to be avoided at present level instead Multicap or Focused funds can be considered.

Value Funds: Suitable options considering quality and value for money at present levels are Tata Equity PE fund, UTI Value Opportunity Fund

Multicap: Suitable options considering quality and value for money at present levels are UTI Equity Fund, Axis Multicap and Motilal Oswal Multicap 35

Focused: Suitable options considering quality and value for money at present levels are Axis Focused 25 and Motilal Oswal Focused 25

Vinod Chopra: What are the best SIPs to start new investments?

Omkeshwar Singh:

Multicap: Suitable options considering quality and value for money at present levels are UTI Equity Fund, Axis Multicap and Motilal Oswal Multicap 35

Focused: Suitable options considering quality and value for money at present levels are Axis Focused 25 and Motilal Oswal Focused 25

Pramod M:

Age: 29 
I am a salaried working professional. 

I hold the following ELSS funds in my portfolio for SIP.

a. AXIS LONG TERM EQUITY FUND – GROWTH
b. DSP TAX SAVER FUND – GROWTH
c. FRANKLIN INDIA TAXSHIELD – GROWTH
d. MIRAE ASSET TAX SAVER FUND REGULAR PLAN – GROWTH

I have been doing a monthly SIP for the above fund for the last 2 years (April 2017). Do you think I should restructure my portfolio or keep as it is? My time horizon is the next 5 years

Which short term funds (up to 1 year) with no-lock in, would you suggest for investing my idle cash (2-5 lakh) which is lying in a bank savings account? How is the capital gain taxed on such schemes? 

Omkeshwar Singh:

You may continue with the 5- & 4-star rated funds.

ELSS: Suitable options considering quality and value for money at present levels are Motilal Oswal Long Term Equity – Growth

Depending upon your requirement of liquidity you may park idle cash in any of the below categories of debt funds with one-year horizon SBI Savings Fund (Money Market Fund), Kotak Low Duration Fund and Axis Ultra Short term Fund

Venkat Subramanya: I have 4 mutual funds listed below:

1. HDFC Balanced Advantage Fund

2. HDFC Hybrid Equity Fund

3. Aditya Birla SL Equity Hybrid 95 Fund

4. ICICI Pru Value Discovery Fund

I have been investing in them from the past 27 months and this is a very long term investment say for my retirement. What returns can I expect after 10 years and do I need to change anything?

I have also invested lumpsum amount of 50k in:

  • Invesco India Growth Opportunity Fund
  • L&T Infrastructure Fund
  • HDFC Small Cap Fund and
  • SBI Blue Chip Fund

Except for L&T others seem to be performing well. Please advise what can be returns in next 5 years

Omkeshwar Singh:

You may continue with the 5 & 4 star rated funds and sectoral funds to be avoided presently for others can be considered from the below.

Value Funds: Suitable options considering quality and value for money at present levels are Tata Equity PE Fund and UTI Value Opportunity Fund

Midcap: Suitable options considering quality and value for money at present levels are Motilal Oswal Midcap 30, DSP Midcap and Axis Midcap

Small cap: Suitable options considering quality and value for money at present levels are Kotak Small Cap and Axis Small Cap

Aggressive Hybrid: Suitable options considering quality and value for money at present levels are Axis Equity Hybrid Fund and Tata Hybrid Equity Fund

Multicap: Suitable options considering quality and value for money at present levels are UTI Equity Fund, Axis Multicap and Motilal Oswal Multicap 35

Focused: Suitable options considering quality and value for money at present levels are Axis Focused 25, Motilal Oswal Focused 25

Rajesh Jain: We have following mutual fund since last one year. Kindly advise should I sale at current NAV. 

Omkeshwar Singh:

4-star rated funds can be continued. Sectoral funds and credit risk funds to be avoided at present and these can be considered:

Small cap: Suitable options considering quality and value for money at present levels are Kotak Small Cap and Axis Small Cap

Multicap: Suitable options considering quality and value for money at present levels are UTI Equity Fund, Axis Multicap and Motilal Oswal Multicap 35

Focused: Suitable options considering quality and value for money at present levels are Axis Focused 25 and Motilal Oswal Focused 25

Midcap: Suitable options considering quality and value for money at present levels are DSP Midcap and Axis Midcap

NC Banik: My 25-year-old son who is working in IT wants to invest in MF for 10 to 15 years duration. He can invest 10,000 to 12,000 monthly. Can you please suggest few funds for him? Is ET Money Apps (Direct fund) safe for investment??

Omkeshwar Singh: A basket can be created from these funds. Investors with proper understating of the mutual fund and those who would not require any guidance for qualified financial advisors should only take direct route.

Multicap: Suitable options considering quality and value for money at present levels are UTI Equity Fund, Axis Multicap and Motilal Oswal Multicap 35

Focused: Suitable options considering quality and value for money at present levels are Axis Focused 25, Motilal Oswal Focused 25

Midcap: Suitable options considering quality and value for money at present levels are DSP Midcap and Axis Midcap

K Unnikrishnan: Sir, I am 53-year-old and currently investing in the following mutual funds, the amount mentioned against it. Please advise if this investment is right or if I have any better option.

1. SBI Blue Chip Fund Direct Growth: Rs 5000

2. Mirae Asset Large Cap Fund: Rs 3000

3. HDFC Equity Fund Direct Growth: Rs 3000

4. HDFC Small Cap Fund Direct Growth: Rs 3000

5. Kotak Emerging Equity Scheme Growth: Rs 2000

6. ABSL Front Line Equity Fund Growth: Rs 4000

7. Franklin India Blue Chip Fund Direct Growth: Rs 3000

8. Franklin India Equity Fund Direct Growth: Rs 3000

Omkeshwar Singh:

4-star rated ones can be continued, remaining 3 may be changed;

Large cap: Suitable options considering quality and value for money at present levels is Mirae Asset Large Cap Fund

Small Cap: Suitable options considering quality and value for money at present levels are Kotak Small Cap and Axis Small Cap

Multicap: Suitable options considering quality and value for money at present levels are UTI Equity Fund, Axis Multicap and Motilal Oswal Multicap 35

Jai: I am doing SIP in following mutual funds:

  • Nippon India Equity Hybrid Fund – Gr: 4000/month
  • Nippon India Small Cap Fund – Gr: 4000/month
  • Aditya Birla Sun Life MNC Fund Gr: 4000 /month
  • Franklin India Prima Fund Gr: 4000/month
  • Motilal Oswal Multicap 35 Fund – Gr: 10000/month
  • SBI Equity Hybrid Fund – Gr: 4000/month

In all of these, Nippon India Equity, which was earlier Reliance, is not doing good. Could you please let me know should I continue investing like this or should I switch to other SIP plans?

Omkeshwar Singh:

You may continue with the 5- & 4-star rated funds and for others you can consider these:

Aggressive Hybrid: Suitable options considering quality and value for money at present levels are Axis Equity Hybrid Fund and Tata Hybrid Equity Fund

Midcap: Suitable options considering quality and value for money at present levels are Motilal Oswal Midcap 30, DSP Midcap and Axis Midcap

Small cap: Suitable options considering quality and value for money at present levels are Kotak Small Cap and Axis Small Cap

Suraj Singh: I have following mutual fund SIPs:

1. Aditya Birla Sun Life Equity Advantage Fund: 3000
2. HDFC Top 100: 3500
3. Reliance Small Cap Growth: 3000
4. Mirae Asset Emerging Blue Chip: 4000
5. HDFC Midcap Opportunity Fund: 3000
6. LNT Midcap Fund: 3000
7. Canara Robeco Emerging Equity: 3000
8. Franklin India Smaller Companies: 3000
9. ICICI Prudential Blue Chip: 3000
10. SBI Blue Chip: 3000
11. Kotak Standard Multicap: 3000

Which funds to be retained and which to be closed or swapped with other funds?

Omkeshwar Singh:

You may continue with the 4 star rated funds and for others can be considered from the below.

Midcap: Suitable options considering quality and value for money at present levels are Motilal Oswal Midcap 30, DSP Midcap and Axis Midcap

Small cap: Suitable options considering quality and value for money at present levels are Kotak Small Cap and Axis Small Cap

Hiralal Khobragade: Dear Sir, please advice. My MF portfolio is predominantly dominated by midcaps. I have SIPs in the following funds:

1. HDFC Midcap Opportunity Fund (G): Rs 10,000 (Since 2013)
2. DSP Blackrock Midcap Fund (G): Rs 10,000 (Since 2015)
3. Canara Robeco Emerging Equity: Rs 10,000 (Since 2017)
4. ICICI Prudential Focused Bluechip Equity Fund – G (Since 2017)

Should I continue with these or need some reshuffling? I would grateful if you could kindly advise me on this.

Omkeshwar Singh:

Continue with the 4-star rated ones, for other 3 you may consider the ones below:

Large cap: Suitable options considering quality and value for money at present levels is Mirae Asset Large Cap Fund

Midcap: Suitable options considering quality and value for money at present levels are Motilal Oswal Midcap 30, DSP Midcap and Axis Midcap

Rajesh Khanna: I have invested my money in MF and I am continuing for last couple of years but am not seeing good growth so kindly advise me whether I should continue with same funds or switch over to some other fund. The funds are:

1. Aditya Birla Sun Life Equity Advantage Fund – Gr: Monthly 1500

2. DSP Midcap Fund – Reg Gr: Monthly 2000

3. HDFC Taxsaver – Gr: Monthly 1500

Also I have invested in SBI Midcap Fund Gr — 70K for last 4 years so I would like to know whether I should be keeping in the same fund or change the fund.

Omkeshwar Singh:

Large and Midcap: Suitable options considering quality and value for money at present levels is Kotak Equity opportunity

Midcap: Suitable options considering quality and value for money at present levels are Motilal Oswal Midcap 30, DSP Midcap and Axis Midcap

ELSS: Suitable options considering quality and value for money at present levels are Axis Long Term Equity Fund Growth and Motilal Oswal long term Equity – Growth

Amit Sharma: Dear Sir, Please review my mutual fund SIP portfolio and suggest possible changes:

1) Tata Retirement Savings Moderate Fund

2) SBI Small Cap Fund

3) Nippon India Small Cap

4) Kotak Standard Multicap Fund

5) L&T Midcap Fund

6) ICICI Prudential Multicap Fund

7) HDFC Small Cap Fund

Omkeshwar Singh:

Midcap and small caps may require changes; rest are fine.

Midcap: Suitable options considering quality and value for money at present levels are Motilal Oswal Midcap 30, DSP Midcap and Axis Midcap

Small cap: Suitable options considering quality and value for money at present levels are Kotak Small Cap and Axis Small Cap

V Srinivas Rao: I am 48 and have following mutual fund SIPs running and the current total value of investments is Rs 61.5 lakh.

  • Motilal Oswal Multicap 35: Rs 3000
  • Motilal Oswal Focussed 25: Rs 12000
  • Kotak Standard Multi Cap: Rs 13000
  • UTI Equity: Rs 5000
  • SBI Healthcare: Rs 5000
  • HDFC Hybrid Equity: Rs 8000

I want to have Rs 85 lakh by 2021 and want to retire to generate Rs 35,000 per month for next 25 years. Hope the above would suffice.

Omkeshwar Singh:

Except for the sectoral fund which is to be avoided at present, rest of the funds are fine; please continue. Both the objectives are in line with the investment and accumulated corpus so far.

Illustration: Dominic Xavier/Rediff.com

Disclaimer: This article is meant for information purpose only. This article and information do not constitute a distribution, an endorsement, an investment advice, an offer to buy or sell or the solicitation of an offer to buy or sell any securities/schemes or any other financial products/investment products mentioned in this QnA or an attempt to influence the opinion or behaviour of the investorsrecipients.

Any use of the information/any investment and investment related decisions of the investors/recipients are at their sole discretion and risk. Any advice herein is made on a general basis and does not take into account the specific investment objectives of the specific person or group of persons. Opinions expressed herein are subject to change without notice.

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