As I discussed in an earlier post, equity is an asset class which will probably perform the best in 2017. While I think it is a good idea to have both an MF and stocks portfolio, for most investors an MF portfolio will be a good place to start. In any case, I think most of my readers are having an MF portfolio and will definitely like to continue the same in 2017.
In this post, let me share the names of a few top funds in different categories which will make a great deal of investment sense in 2017. There are two important things to note here. Firstly, do not get swayed into buying MF through all kinds of statistical analysis and tools. These methods are amateurish even though I daresay they are sincere. Like every industry, the MF industry has professionals who are knowledgeable and neutral. It is very logical to go with their recommendations, reinventing the wheel has always been a rather poor idea. The funds suggested in this post are taken from the TV program “Investors Guide”. Secondly do not change your portfolio just because these funds are not there in it. There are several good MF schemes from different fund houses and changes should only be done when your annual review has shown some funds in your portfolio to be performing poorly. For new MF investors, I think it will make a lot of sense to pick some funds out of the ones mentioned in this post.
Coming to the fund categories, let us start with the multi-cap category. You must have this in your portfolio even if you are having only one category. Based on performance and potential, the following funds are recommended ones :-
- ICICI Value Discovery fund
- Franklin India High Growth companies fund
- Birla Sun Life Equity fund
- SBI Magnum Multi-cap fund
It will be important to have the mid-cap category fund in your portfolio too as these are the potential large caps of the future. Recommended funds in this category are :-
- Mirae Asset Emerging Blue chip fund
- Principal Emerging Blue Chip fund
- UTI Mid-cap fund
- Franklin India Prima fund
You also need to have the small cap category fund in your portfolio as, despite the risks, these are likely to reward you substantially in the future. Recommended funds are :-
- DSP BR Micro cap fund
- Franklin India Smaller Companies fund
- Reliance Small cap fund
- SBI Mid and Small cap fund
Finally the large cap category is important as it is likely to do well in 2017 and it provides some stability to your portfolio. Recommended funds in this category are :-
- Mirae Asset India Opportunities fund
- SBI Blue Chip fund
- Birla Sun Life top 100 fund
- Quantum Long Term Equity fund
For a good long term MF portfolio you just need to pick a fund from each category and invest in them regularly. You can decide on your allocation based on your risk taking ability, but even if you allocate 25 % of your money to each category, you will be fine.
Should you do SIP – not in general and in 2017 it will be a particularly bad idea. I will explain how you can invest in your portfolio in the next post.