Ask ET Mutual Funds: Should I stop SIP in BSL Frontline Equity Fund?

I have an SIP in the following funds: Birla Sun Life Frontline Equity Fund, DSP BlackRock Micro Cap Fund, Franklin India Smaller Companies Fund, Mirae Asset Emerging Blue Chip Fund, Birla Sun Life Tax Relief 96 Fund. I am planning to stop the SIP in Birla Sun Life Frontline Equity Fund and start an SIP in DSP BlackRock Tax Saver Fund and HDFC Mid-Cap Opportunities Fund. Please suggest.
-- Ayush Agarwal

Vishal Ramaswamy, a mutual fund advisor, responds:
In my opinion, there is no need to stop and switch your investments. You have chosen some of the best funds and diversified smartly. I think your reason to stop the SIP in Birla Sun Life Frontline Equity and switch to HDFC Mid-Cap Opportunities is to capitalise on the out-performance of midcap funds. However, you already hold other funds (Franklin India Smaller Companies Fund and Mirae Asset Emerging Blue Chip Fund, which provide sufficient exposure to that space. I would ask you to continue with the Birla Sun Life Frontline Equity Fund so that you capitalise on any move that would take place in the largecaps as well. Remember if the market (Nifty/Sensex) goes up, the blue chips will always lead. Also, any fall from the highs will help you to average better in your existing funds rather than starting new ones.


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