Wednesday, April 2, 2008

Mutual Fund Advise

One invester asked "I have invested Rs40000 & Rs 60000 inFidelity Equity & FR. Prima Plus for the last 2-3 years. Now I want to go fora redemption and reinvest the same amount in Kotak Oppertunity and Sundaram Focous respectively. Is the selection of funds and timing is right ?"

Dear Guest,
Selection of funds is secondary for you. Firstly why do you want to switch?. If it is because of laggard performance, then you are 50% not right. I said 50% because Fidelity Equity Fund may have been underperformer in recent times but they have outperformed the Benchmark since inception and more importantly they have a solid reputation and will in all probability give you above average returns.
As for Franklin Prima Plus, not just this fund almost all funds from the Franklin Templeton Fund House have been laggard and underperformed and you would do well to switch partly or in fact fully. And you would better off if you can split the amount and invest equally in Sundaram Select Focus and preferably DSPML Top 100 Fund.
I would like to add one more thing., it is always risky to have too much exposure to one particular Fund House. In your case your investment is spread over just 2 Fund House. Kindly try to spread your investments
And next time try to invest through SIPs to ride out the market volatility and earn above average returns. You could also consider investing in funds like
Birla Sunlife Equity Fund
DSPML Tiger fund
HDFC Top 200 Fund
Kotak 30 Fund
Reliance Growth Fund
SBI MAgnum Comma fund

Best of luck.

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