MF portfolio doctor: Rajpal should either hike monthly mutual fund SIP amount or scale down goals

Not many investors know whether they have invested in the right mutual funds and if their fund portfolio is on track. The Portfolio Doctor assesses the health of the fund portfolio, examines the schemes and their suitability with regard to the goals and, if required, recommends corrective measures. The advice given is based on the performance of the funds, the risk profile of the investor as well as his financial goals.

CASE I: Raunaq Rajpal invests in equity funds for multiple goals. Here’s what the doctor has advised him:

Goals

Portfolio check-up

• Started working last year and already has impressive corpus.
• Early start, high risk appetite and disciplined approach will prove beneficial.
• Ambitious goals need big jump in SIPs. They also have to be hiked by 15% every year.
• Stock investments are risky. Review portfolio regularly.

Note from the doctor

• Don’t let money idle in savings account.
• Use debt funds and bank deposits to save for short-term goals.
• Invest in equities only if goal is more than 5-6 years away.

CASE II: Niraj Raval is saving for his kids’ goals and his retirement. Here’s what the doctor has advised:

Goals

Portfolio check-up

• Investing in equity funds for past 2-3 years.
• Portfolio is a good mix of small, mid and large-cap funds.
• Goals are very ambitious and require big increase in monthly investments.
• SIPs will also have to be increased by 10% every year.
• Stock investments are risky and require expertise. Consider mutual funds instead.
• Review investments and rebalance at least once in a year.
• Reduce risk when goal is near so that you don’t miss the target.

Assumptions used in the calculations
Inflation

• Education expenses: 10%
• For all other goals: 7%

Returns

• Equity funds: 12%
• Debt options: 8%

Portfolios analysed by Raj Khosla, Managing Director and Founder, MyMoneyMantra

Write to us for help
If you want your portfolio examined, write to etwealth@timesgroup.com with 'Portfolio Doctor' as the subject. Mention the following information:

• Names of the funds you hold.
• Current value of the investment.
• If you have SIPs running in any of them.
• The financial goals for which you invested.
• How much you need for each financial goal.
• How far away is each goal.