Mutual Funds

Your Fund Portfolio

Aarati Krishnan | Updated on January 09, 2018 Published on November 12, 2017

I had invested ₹1 lakh in my son’s name in 2010 in Sundaram Mutual Fund’s debt schemes, with a ₹1,000 per month Systematic Transfer Plan to Sundaram Select Midcap and Sundaram SMILE Fund. The portfolio value now stands at around ₹3.3 lakh. The performance of the fund house does not seem all that good.

Please advise whether I should stay invested or go for partial withdrawal of around ₹1.2 lakh, then do an STP of ₹2,500 into each of the following funds: Mirae Asset India Opportunities, Aditya Birla Sun Life Advantage, Principal Emerging Bluechip and L & T Emerging Business Fund. Kindly suggest alternatives too.

V Sivakumar

Of your two funds, Sundaram Select Midcap is a reasonable long-term performer. Its five-year and three-year returns at 25 per cent and 20 per cent, respectively, are slightly ahead of the benchmark and the mid-cap category, while performance in the last one year lags both. You could hold on to this fund but switch out of Sundaram SMILE Fund. The fund has trailed other small-cap funds over five years. It is also unwise to have all your investments towards one goal in a single AMC. From the list of funds you have considered, you seem to be unsure whether to switch the proceeds into a multi-cap fund or mid-cap fund.

The decision should depend on the volatility you are willing to take on and the number of years you have left to your goal (if 10 years or more, you can consider mid-cap funds). Mirae Asset India Opportunities is a good large-cap option, while Aditya Birla Sun Life Advantage is a good multi-cap option. You can also add on HDFC Midcap Opportunities for a mid-cap flavour.

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