Building an equity MF portfolio in new FY

Much as I would like to write regularly for the blog, of late I find it difficult to get the time to do so. In the last 3 months I have been rather busy mentoring B school aspirants and very recently went on a vacation to Phuket for a week. The blog remains close to my heart though and in this new FY I will make a renewed attempt to be regular in writing.

I get a lot of reader queries on how to create an ideal long term portfolio of equity MF schemes. There have been several posts written on this and you can search the blog to read those up. However, fund performances and the market dynamics keep changing, so it will make sense to revisit that now. With the new SEBI classification of MF categories it is easier to build a portfolio now. You can have a set of choices in each category and then select one from each to get your 4-5 funds. I have given a choice of a few funds in different categories below and any selection of these will result in creation of a robust, long term portfolio of equity MF. These are all well known funds that have been recommended by several analysts and I have done my own fact finding about these too, so I can suggest them with complete confidence.

Here are the MF scheme suggestions in the different categories :-

  • Large cap funds
    • HDFC Top 100
    • ABSL Front Line Equity
    • ICICI Blue Chip
  • Multi cap funds
    • Franklin India Equity
    • Mirae Asset India Equity
    • Kotak Standard Multi cap
  • Mid cap funds
    • Franklin Prima fund
    • DSP Mid cap fund
  • Small cap funds
    • DSP small cap fund
    • HDFC small cap
  • ELSS funds
    • Axis Long term equity
    • Franklin India Tax shield

If you want you can add an international fund to this mix but that is only required for sophisticated investors. Most of you can simply select funds from the categories here and build a portfolio where you can invest for the long term. Some pointers for this :-

  • If your risk appetite is low and you are disagreeable to market volatility then you may want to stick to only large cap and multi cap category, with a small investment in mid caps. Avoid small cap funds in this case.
  • If you believe in the India growth story and are looking at the long term for your portfolio then have a mix of all categories with sufficient allocation to mid cap and small cap funds.
  • If you are well off and looking at this portfolio to have high growth with tolerable risks then put most money in mid cap and small cap funds. There will be a lot of volatility but over the next 15-20 years you will be able to get good benefits.

What about the likely returns from these fund categories and where should we invest for fixed income then? I will cover these in other posts, hopefully soon !!

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2 thoughts on “Building an equity MF portfolio in new FY

  1. Mirae Asset India Equity will now be long term. Sir what’s your opinion on ICICI value discovery and Quantum Long Term

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