Ask ET Mutual Funds: Do I need to change my portfolio?

I am 23 years old, and a salaried govt employee with net salary of Rs 23,000 per month. I have invested in the following funds through monthly SIPs: Rs 1,000 in L&T Business Cycles Fund- (G), Rs 1,500 in Birla Sun Life Manufacturing Equity Fund- (R)(G), Rs 2,000 in ICICI Long Term Equity Fund, Rs 500 in UTI Equity Fund (D)(G), Rs 500 in UTI Midcap Fund (D)(G). I would like to know the scope of my investments in the coming five years, 10 years and 20 years. Do I need to change my portfolio? Should I add some more funds?

--Saurabh Shrivastava

Gaurav Monga, Certified Investment Planner, responds:


Considering your investment horizon, you have chosen the right asset class: equity. Further, you are investing in two specific theme-based funds - L&T Business Cycles Fund and Birla Sun Life Manufacturing Equity Fund. The performance of these funds depends on the sector and tends to be cyclical in nature. Investing in diversified equity funds is a better way to invest. Also, the number of schemes held is on the higher side. Ideally, it should be limited to three schemes. The following actions/changes are recommended:

a) Continue investing Rs 2,000 in ICICI Long Term Equity Fund (Tax saving scheme),

b) Increase the investment amount in UTI Midcap Fund to Rs 1500

c) Start a fresh SIP of Rs 2,000 in Birla Sun Life Advantage Fund which is a diversified muticap fund.


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