Friday, September 5, 2008

Financial Planning Advise

From: Kailas Pethkar
To: sharesher@indiatimes.com, goodfundadvisor@yahoo.com
Sent: Sun, 27 Jul 2008 13:04:19 +0530 (IST)
Subject: Financial planning advice





Dear friend,

I am an NRI, 30 year old, recently married. I am responsible for living expenses of my retired parents who dont have source of income such as pension or annuity. I have constructed my new house recently completed at my town in Maharashtra where my parents reside. I dont have any other property elsewhere. I want to create a sound portfolio of stocks, mutual funds and debt instruments for future. I am considering to keep the age as percentage of debt investment and rest in equity/mutual funds. I request your valuable advice towards better financial planning for future.





  • I started investing in mutual funds since February 2008. Till date I have invested Rs. 751000 this year. Details below.
  • Also I had purchased Bajaj Allianz Century Plus ULIP with Rs. 50k per year premium. This will be continued for 10 years.
  • I had purchased LIC moneyback policy in October 2003 with quarterly premium of Rs. 3971. The policy is effective till date.


I am enclosing below the details of mutual fund investments for your reference.


1a. Birla Advantage(G)-5000 on 21.02.2008

1b. Birla Advantage(G)-5000 on 10.03.2008


1c. Birla Advantage(G)-5000 on 25.03.2008




2a. Birla Basic Industries(G)-10000 on 04.03.2008


2b. Birla Basic Industries(G)-5000 on 10.03.2008



2c. Birla Basic Industries(G)-5000 on 25.03.2008



2d. Birla Basic Industries(G)-5000 on 18.06.2008




3a. Birla Sunlife Equity(G)-10000 on 04.03.2008


3b. Birla Sunlife Equity(G)-5000 on 10.03.2008


3c. Birla Sunlife Equity(G)-50000 on 25.03.2008



4a. Birla Frontline Equity(G)-10000 on 04.03.2008


4b. Birla Frontline Equity(G)-5000 on 10.03.2008


4c. Birla Frontline Equity(G)-5000 on 28.05.2008



5a. Birla Infrastructure(G)-10000 on 04.03.2008


5b. Birla Infrastructure(G)-5000 on 25.03.2008



6a. Birla Midcap(G)-5000 on 04.03.2008


6b. Birla Midcap(G)-5000 on 10.03.2008


6c. Birla Midcap(G)-5000 on 04.04.2008


6d. Birla Midcap(G)-5000 on 18.06.2008



7a. Birla Special Situations(G)-50000 on 31.01.2008


7b. Birla Special Situations(G)-switchout to Birla Sunlife Equity Fund - 10000 on 04.03.2008



7c. Birla Special Situations(G)-switchout to Birla Sunlife Basic Industries Fund - 10000 on 04.03.2008



7d. Birla Special Situations(G)-switchout to Birla Sunlife Frontline Equity Fund - 10000 on 04.03.2008



7e. Birla Special Situations(G)-5000 on 25.03.2008





8. DSP Balanced(G)-10000 on 19.06.2008




9a. DSP Equity(G)-30000 on 25.02.2008


9b. DSP Equity(G)-10000 on 19.06.2008



10a. DSP TIGER(G)-30000 on 15.02.2008


10b. DSP TIGER(G)-15000 on 11.03.2008


10.c DSP TIGER(G)-10000 on 19.06.2008




11. DSP Top 100(G)-20000 on 02.06.2008



12. DWS Alpha Equity(G)-20000 on 30.05.2008



13. DWS Investment Opportunity(G)-20000 on 30.05.2008




14. HDFC Growth(G)-5000 on 18.06.2008



15. HDFC Infrastructure(G)-30000 on 30.02.2008



16a. HSBC Equity(G)-20000 on 12.05.2008


16b. HSBC Equity(G)-10000 on 19.06.2008



17a. ICICI Pru Dynamic(G)-5000 on 09.05.2008


17b. ICICI Pru Dynamic(G)-5000 on 23.05.2008



18a. ICICI Pru FMCG(G)-5000 on 02.05.2008


18b. ICICI Pru FMCG(G)-5000 on 20.05.2008



19a. ICICI Pru Index(G)-5000 on 27.05.2008


19a. ICICI Pru Index(G)-2000 on 12.06.2008


19a. ICICI Pru Index(G)-3000 on 18.06.2008




20a. ICICI Pru Infrastructure(G)-20000 on 25.03.2008


20b. ICICI Pru Infrastructure(G)-5000 on 18.06.2008



21a. Kotak-30(G)-5000 on 02.05.2008


21b. Kotak-30(G)-5000 on 09.05.2008


21c. Kotak-30(G)-5000 on 22.05.2008



21d. Kotak-30(G)-5000 on 28.05.2008





22. Kotak Opportunities(G)-20000 on 11.03.2008



23. Magnum COMMA(G)-20000 on 25.03.2008



24. Magnum Contra(G)-5000 on 18.06.2008



25a. Reliance Banking(G)-5000 on 23.04.2008


25b. Reliance Banking(G)-5000 on 21.05.2008


25c. Reliance Banking(G)-5000 on 27.05.2008



25d. Reliance Banking(G)-5000 on 19.06.2008





26. Reliance Div Power(G)-30000 on 14.02.2008


26. Reliance Div Power(G)-15000 on 11.03.2008


26. Reliance Div Power(G)-5000 on 26.05.2008



26. Reliance Div Power(G)-5000 on 29.05.2008





27. Reliance Growth(G)-25000 on 18.06.2008



28a. Reliance Regular Savings-Equity(G)-5000 on 09.05.2008


28b. Reliance Regular Savings-Equity(G)-5000 on 23.05.2008



29. Sundaram Capex Opp(G)-20000 on 17.03.2008



30. Sundaram Growth(G)-20000 on 02.06.2008



31. Sundaram Select Focus(G)-20000 on 02.06.2008



32. Tata Equity P/E(G)-10000 on 19.06.2008



33a. Tata Infrastructure(G)-20000 on 11.03.2008


33b. Tata Infrastructure(G)-10000 on 19.06.2008



34. Templeton India Growth(G)-20000 on 12.05.2008




35a. Birla Dynamic Bond fund (D-Q Reinvestment) – Rs. 10000 on 21.07.2008

35b. Birla Dynamic Bond fund (D-Q Reinvestment) – Rs. 5000 on 25.07.2008


36. Kotak Flexi Debt (D-Q Reinvestment) – Rs. 10000 on 21.07.2008


37a. HDFC High Interest Short Term Plan – (D-Reinvestment) – Rs. 10000 on 21.07.2008

37b. HDFC High Interest Short Term Plan – (D-Reinvestment) – Rs. 5000 on 25.07.2008



Please review my investment portfolio and suggest me changes for optimising the returns. Also I wish to know which insurance will be suitable for me since I dont have sufficient insurance, I feel.



Thanks in anticipation.


Regards,
SRIKANTH SHANKAR MATRUBAI'S REPLY :::
Dear Kailash,
At the outset, I apologise for my delayed reply. I have been extra busy lately due to Tax Returns filing, or I would have definitely replied much earlier.

I went through your mail at least 5 times and this has been my honest analysis about the same.

First, the good thing. The fact that you have completed the construction of your home is great news for your finances. This straight takes away a lot of headache in planning your secure and h(w)ealthy future.
The fact that you are considering your age as a percentage of your exposure to debt shows that you have good financial acumen and after looking at your portfolio, shows that your financial acumen only needs a bit of polishing and setting them on the right road of riches.
I will make an honest effort.
Your portfolio is shocking. First of all, you have started your investments just after the burst of Big Bull Run in Feb 2008 and most disappointingly, all of your investments have through LUMP SUM.
Another disappointing aspect I noticed your switching from funds, after a period of just 3 months!!!!. Shocking!!

You need to change your financial advisor at once. If you do not have one, get one immediately. If you could not afford, try to read the messages on moneycontrol messageboard and visit goodfundadvisor.blogspot.com , where you can learn a lot and make yourself a competent investor.
You look to be a collector of funds, rather than an investor.

You have 34 equity funds, which is too too big and unwieldy all at once.
You need to take harsh decisions and sell some and switch some.

Sorry, Mr.Kailash, your mutual fund advisor is self-centred. you should have consulted some competent persons. At least, an email to me or someone from moneycontrol messageboard would have saved lot of money and headache.

After going a lot of thought to your portfolio, I suggest you have the following funds in your portfolio from the present one.

1. Birla Sunlife Equity Fund
2. Birla Sunlife Frontline Fund
3. DSPML Balanced Fund
4. DSPML Tiger Fund
5. DSPML Top 100 Fund
6. DWS Investment Opportunity Fund
7. HDFC Growth Fund
8. HDFC Infrastructure Fund (I am advising an hold on this fund, only becoz it is a close ended fund. Review the same when it becomes open ended)
9. HSBC Equity Fund
10. ICICI Dynamic Fund
11. ICICI Index Fund
12. Magnum Comma Fund
13. Magnum Contra Fund
14. Reliance Growth Fund
15. Sundaram Select Focus Fund


Unfortunately, you do not have any International Fund. Do add one by buying either Templeton India Equity Income Fund or Birla Sunlife International Fund

Also, you can consider switching from ICICI Dynamic Fund to ICICI Power Fund.

Please, Please, it my humble request to you, Please invest preferably through sips.
And invest in diversified Equity Funds.

Regards,
Best of luck,
Srikanth

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