Hold few funds, avoid clutter
I am 32, married and have a child. I wish to invest Rs 12,000 for the long-term in the following funds via systematic investment plans (SIPs). I have chosen tax-saving funds. Please review and advise.
- Vimal Gupta
There are two problems in your portfolio. 1) Too many funds 2) A third of it is exposed to mid- and small-cap funds, too risky.
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We have selected a few quality funds from your portfolio and suggested some more to choose from. Keep a total of 4 funds from our suggestions; this will enable you to manage the portfolio better.
You may choose any 3 funds from the suggested list. Since you want to invest in tax-saving funds, you may retain these; they are diversified and suitable to form your core funds. While selecting core funds, remember to choose across fund houses. Spread your investment across these funds so that your core funds forms 70-80 per cent.
| Funds | Amount (Rs) |
| ICICI Pru Discovery | 1,000 |
| DSPBR Mid- & Small-cap Reg | 1,000 |
| HDFC Equity | 2,000 |
| IDFC Premier Eq Plan A | 2,000 |
| HDFC Taxsaver | 1,000 |
| Canara Robeco Eq Tax Saver | 1,000 |
| Reliance Reg Savings Bal | 1,000 |
| HDFC Prudence | 2,000 |
| HDFC Children's Gift Sav | 1,000 |
| Core Funds | Supporting Funds |
| HDFC Prudence | ICICI Pru Discovery |
| DSPBR Balanced | IDFC Premier Eq Plan A |
| HDFC Equity | |
| Reliance Reg Savings Bal | |
| DSPBR Equity | |
| HDFC Taxsaver | |
| Canara Robeco Eq Tax Saver |
Which is better gold exchange-traded funds (ETFs) or gold mining companies? What are the options available?
-S Grover
If you want gold to be a part of your portfolio, a gold ETF is the best option. It's the closest you can get to an investment in physical gold. Gold ETFs trade on bourses and return in accordance to physical gold in spot market. To invest in an ETF, you will need a demat account. But these are not sold by distributors and do not allow systematic investment (SIP).
The other options available are the two gold funds, AIG World Gold Fund and DSPBR World Gold. They invest in stocks of gold mining companies and are more volatile than ETFs.
I would like to invest Rs 50,000 in two Equity-linked Savings Schemes (ELSS) . I have selected Canara Robeco Equity Tax Saver, Sundaram BNP Paribas Taxsaver and BSL Tax Relief 96. Which two should I go for? I would redeem after three years.
- JK Martha
Canara Robeco Equity Tax Saver and Sundaram BNP Paribas Taxsaver are funds with good track records. You may choose to invest via an SIP.
| Schemes | 3-year Returns (%) |
| Canara Robeco Eq Tax Saver | 17.68 |
| Sundaram BNP Paribas Taxsaver | 13.00 |
| BSL Tax Relief 96 | 6.96 |
| Category Average | 7.38 |
| Returns as on June 30 | |
I want to invest in Quantum Long Term Equity Fund for 5-10 years via SIP. Is it a good fund for the long-term? I have already invested in HDFC Top 200 and ICICI Prudential Dynamic.
- Vijay Prakash
Quantum Long Term Equity falls under the large- and mid-cap category. Go ahead with investing in it. It is a good fund for the long-term. Your choice of funds are well-rated and diversified.
| Schemes | Return (%) | |
| 1-year | 3-year | |
| Quantum Long Term Equity | 49.71 | 15.96 |
| Category Average | 29.84 | 7.81 |
| Returns as on June 30 | ||
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| 28 May 12 | IDFC SSIF - MTP - Plan A (Div-Bimonthly) | 0.17 |
| 28 May 12 | Birla Sun Life Short Term FMP - Series 23 (D) | 0.45 |
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| 31 May 12 | Escorts Income Plan - (D) | 0.09 |
| 31 May 12 | Escorts Short Term Debt Fund (D) | 0.11 |
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