iStockI am currently investing Rs 10,000 per month in the following mutual funds:
SBI Small Cap Fund
HDFC Mid-Cap Opportunities Fund
Parag Parikh Long Term Equity Fund
ICICI Prudential Bluechip Fund
Motilal Oswal Multicap 35 Fund
All these funds are in direct, growth options and I am investing Rs 2,000 each in them. I am aiming to invest for a long period of 10 years. Should I continue the SIP in current scenario or pause it? Also, should I change the funds?
- Prikshit Gothwal
We believe investors should choose mutual funds based on their financial goals, investment horizon, and risk profile. Since you are investing for a long period of 10 years, you may invest in equity mutual fund schemes. However, the category of equity mutual fund would depend on your risk profile. Since you have not mentioned your risk profile, it is not possible to offer a personal comment. However, here are some pointers that might help you to grasp the idea.
You are currently investing in two multi cap schemes, a small cap scheme, mid cap scheme, and large cap schemes. Multi cap schemes are ideal for investors with a moderate risk profile, while large cap schemes are ideal for conservative investors. However, mid and small cap schemes are recommended only to aggressive investors as these schemes are extremely risky and volatile. Assess your risk profile and make sure that the schemes are in line with your risk profile.
You should never base your investment decisions on the prevailing market conditions. In fact, stopping an SIP during a volatile or falling market is a very poor strategy. The basic premise of SIP is to invest a small sum regularly, irrespective of the market conditions, over a long period to create wealth. When you are investing through ups and downs, you be able to amass more units and it would also help you to bring down your average purchase cost. That is how SIP helps you to maximise wealth over a long period.
If you are new to mutual funds, you should seek the help of a mutual fund advisor. It is not easy to take care of your investments on your own. Invest through an agent and gain some experience, knowledge and expertise, before starting to invest on your own.
SBI Small Cap Fund
HDFC Mid-Cap Opportunities Fund
Parag Parikh Long Term Equity Fund
ICICI Prudential Bluechip Fund
Motilal Oswal Multicap 35 Fund
All these funds are in direct, growth options and I am investing Rs 2,000 each in them. I am aiming to invest for a long period of 10 years. Should I continue the SIP in current scenario or pause it? Also, should I change the funds?
- Prikshit Gothwal
We believe investors should choose mutual funds based on their financial goals, investment horizon, and risk profile. Since you are investing for a long period of 10 years, you may invest in equity mutual fund schemes. However, the category of equity mutual fund would depend on your risk profile. Since you have not mentioned your risk profile, it is not possible to offer a personal comment. However, here are some pointers that might help you to grasp the idea.
You are currently investing in two multi cap schemes, a small cap scheme, mid cap scheme, and large cap schemes. Multi cap schemes are ideal for investors with a moderate risk profile, while large cap schemes are ideal for conservative investors. However, mid and small cap schemes are recommended only to aggressive investors as these schemes are extremely risky and volatile. Assess your risk profile and make sure that the schemes are in line with your risk profile.
You should never base your investment decisions on the prevailing market conditions. In fact, stopping an SIP during a volatile or falling market is a very poor strategy. The basic premise of SIP is to invest a small sum regularly, irrespective of the market conditions, over a long period to create wealth. When you are investing through ups and downs, you be able to amass more units and it would also help you to bring down your average purchase cost. That is how SIP helps you to maximise wealth over a long period.
If you are new to mutual funds, you should seek the help of a mutual fund advisor. It is not easy to take care of your investments on your own. Invest through an agent and gain some experience, knowledge and expertise, before starting to invest on your own.
( Originally published on Jun 09, 2020 )
(If you have any mutual fund queries, message us on ET Mutual Funds on Facebook. We will get it answered by our panel of experts.)
Get Unlimited Access to The Economic Times
