I am a 33-year- old salaried person. I have been investing Rs 1,000 per month in IDFC Focused Equity fund (Direct, Growth) and Rs 5,000 per month in Invesco India Growth Opportunity Fund (Direct Growth) since march 2018. Earlier I was investing Rs 10,000 per month in Mirae Asset Tax Saver Fund (Direct Growth) which I stopped and is now saving tax by putting money in Sukanya Yojna and PPF. I am enjoying Section 80C rebate of Rs 1.5 lakhs. At present I can take out Rs 10,000 per month for starting SIP. Kindly advise the route map/ portfolio to follow for creating long term wealth. Should I increase my SIP in my existing funds or start some new ones? I have a long-term horizon (10 years plus) and an appetite of moderately high risk.
— Rohit Gupta
Rushabh Desai, an Amfi-registered mutual fund distributor based in Mumbai responds:
You are invested in a focused fund which has a concentrated portfolio spread across market capitalizations and a large & mid cap fund which predominantly invests in large & mid cap companies. As per their risk-o-meter, both of these funds come under high-risk brackets. These funds may technically not suit you as per your risk appetite which is moderately high.
Looking at your age of 33 years, your long-term horizon of 10 years plus and your goal of wealth creation, I don’t see much of a problem for you to take higher risk, especially after you shifted your entire tax saving money from equities towards a safer asset class in government fixed income schemes.
I recommend you the following funds for your current monthly SIP amount at Rs 10,000 – Invesco India Growth Opportunity Fund (Rs 5,000) and Mirae Asset Focused Fund (Rs 5,000) instead of IDFC Focused Fund. But If you are unable to take higher risk and cannot handle high volatility then you can venture into UTI Index Fund Nifty 50 (Rs 5,000) and Kotak Flexi Cap Fund (Rs 5,000).