Is it the right time to redeem my mutual fund units?

I want to redeem 1300 units of Tata Ethical Fund (Growth). It is one year old. Is it advisable to redeem it now?
--Usman Kurupakka

Abhay Shah, a Certified Financial Planner, responds:


Yes, it has been underperforming since quite a while now. For example, it has given CAGR of 8.32 per cent in the last 12 months, whereas Motilal Oswal MOSt Focused Multicap 35 Fund, another fund in the same category (multicap), has given more than 30 per cent returns. The difference is, undoubtedly, huge. Switch to another better performing fund. For instance, Motilal Oswal MOSt Focused Multicap 35 Fund is a good scheme.