Ask ET Mutual Funds: Have I picked up the right mutual fund schemes?

I am 23 years old, and I have just started an SIP of Rs 1,000 in DSP BlackRock Micro Cap Fund. I am planning to invest in a diversified and largecap fund. I am thinking about L&T India Value Fund, DSP BlackRock Opportunities Fund and DSP BlackRock Focus 25 Fund. My investment horizon is long term and objective is wealth creation. Kindly advise on these funds. I am also keen on IDBI Nifty Junior Index Fund.
-- Sayaneel Kar

Puneet Oberoi, CFP, Excellent Investment Advisorz, responds:
Since you are just 23 years old, I am assuming that you must have recently started your career. It seems that you have long term goals. You have chosen good funds, but my recommendation would be to be bullish in small & midcap funds for the next few years.


As far as Indian growth story is concerned, mutual fund houses can deliver good alpha over index funds, so it would be better to invest in actively-managed funds for a few years as long as these fund houses are delivering alpha over index funds.

DSP BlackRock Opportunities & DSP BlackRock Focus 25 have common stock intersection, lot of them are even overlapping in Franklin India Smaller Companies Fund.

So, my recommendations for the time being would be to invest in these two funds:

1. Franklin India Smaller Companies Fund
2. DSP BlackRock Micro Cap Fund