I am 32 years old and I have a moderate risk appetite. My goal is to build a corpus of Rs 1.5 crore in 15 years. I am investing in these mutual fund schemes via SIPs:
Axis Long Term Equity Fund: Rs 1,000
HDFC Top 200 Fund: Rs 3,000
Aditya Birla Sun Life Frontline Equity Fund: Rs 3,000
Franklin India Bluechip Fund: Rs 2,000
ICICI Prudential Value Discovery Fund: Rs 2,000
Kotak Standard Multicap or Kotak Select Focus Fund: Rs 4,000
L&T Hybrid Equity Fund: Rs 4,000
My queries are:
- Should I continue to invest in these mutual fund schemes? Or, should I exit some?
- I can invest Rs 5,000 more. Should I invest in another scheme via an SIP? Or, should I increase my allocation in any of the above scheme? If yes, which one?
- Should I invest a small amount, say, Rs 2,000 to Rs 3,000 in many mutual fund schemes? Or should I invest a higher amount, Rs 5,000 to Rs 8,000, in two or three schemes?
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To create a corpus of Rs 1.5 crore in 15 years, assuming that your portfolio will deliver an annual return of 15 per cent, you need to invest Rs 24,336 per month. Your current investment corpus, including your extra investment of Rs 5000, is Rs 24,000. That means, you have rightly identified how much you need to invest to build your target corpus.
However, you should make some changes to your portfolio.
You have selected some good mutual fund schemes. These schemes have strong fundamentals and they have been performing consistently. However, considering your risk profile and long-term objective, there is further scope to add value in your portfolio. As you have defined your risk appetite as moderate, you should be comfortable with midcap schemes. These schemes are the ideal choice for a long-term investment.
| Existing scheme name | Remark | Amount (Rs) |
| Axis Long Term Equity Fund | Continue with investment | 1,000 |
| HDFC Top 100 Fund | Switch to HDFC Mid-Cap Opportunities Fund | 5,000 |
| ABSL Frontline Equity Fund | Continue with investment | 3,000 |
| Franklin India Bluechip Fund | Switch to Franklin India Prima Fund | 5,000 |
| ICICI Pru Value Discovery Fund | Continue with investment | 2,000 |
| Kotak Standard Multicap Fund | Continue with investment | 4,000 |
| L&T Hybrid Equity Fund | Continue with investment | 4,000 |
Total: Rs 24,000
You are switching to two midcap schemes with top-up investments, which includes the Rs 5,000 extra.
There is no need to include more schemes in your portfolio as it already consists seven mutual fund schemes. Having too many schemes will dilute your objective and it will also make reviewing your portfolio difficult.
In your last question, you have asked about diversification. The element of diversification is very important in a mutual fund portfolio. It will safeguard the core objective of your investment. The scheme or asset diversification is further dependent on other elements like size of the portfolio, your risk profile, etc. Generally, an investor should have diversification in terms of mutual fund schemes and can have five to seven schemes in a portfolio with proper asset allocation.
