Your Fund Portfolio

I am 30 and my annual income is roughly ₹10 lakh. I have just started to invest ₹5,000 monthly SIPs each in HDFC Tax Saver and Franklin India Tax Shield. I also invest ₹3,000 monthly in HDFC Mid-Cap Opportunities. I want to invest for 15 years. What returns should I expect ?

Love Kapoor

Franklin Tax Shield and HDFC Tax Saver have underperformed their benchmarks over one- and three-year time-frames. You can stop the SIPs and consider regular investments in Axis Long Term Equity and Principal Tax Savings instead.

Mid-cap stocks had run up too sharply in the last two-three years. Hence, such stocks and consequently mid-cap funds are at risk of erosion in their Net Asset Values for the near term if the ongoing market correction continues.

However, for the long term, HDFC Mid-cap Opportunities is a good fund to hold.

It is not clear why you have a 15-year time-frame in mind. You can actually invest until your retirement. Towards this, you can create a well-rounded portfolio by adding some large- and multi-cap funds as and when your surplus increases.

As far as return expectations go, while past returns are not indicative of future, diversified equity funds across categories (large-, mid-, multi-cap, ELSS, etc) have delivered a return of 11-16 per cent in the past 10 years. Hence a 10-15 per cent return for your portfolio as a whole is a reasonable expectation.

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