Sir,

Presently my portfolio consist of following MF through SIP from May` 09:
1. Birla Frontline
2. DSPBR Top 100
3. HDFC Top 200
4. Sundaram Select Focus

Now, I want to invest lump sum of 20k - 25k. Which fund should i consider to invest? i have shortlisted following funds:
1. ICICI Pru Infra
2. IDFC Premier Equity
3. Sundaram Select Mid cap / SMILE
4. Birla Mid cap
5. Canara Robeco Infra

Pls. guide me.

Dear MRV, Ur existing funds where u r already investing thru SIP (individual as well as composite SIP amount u forget to post) r all Large cap funds.

From diversification point of view, u may add a Midcap fund. IDFC Prem. Eq. is ok for it. Invest thru STP.

In case of Infra funds as asked by u, plz. make sure that investment in such sectoral/thematic funds is not more than 5-8% of ur total portfolio.

Among Infra funds, IPru infra is better.

Thanks

Ashal

Dear Sir,

Thanks for your reply.

Can you explain me how exactly STP works?

Mehul

Dear MRV,

For STP (Systematic Transfer Plan) you can invest in a liquid / debt fund and fill STP form to transfer a fix amount from this fund to other fund.

In your case, for IDFC, you can invest in any of the following:
IDFC Dynamic Bond Plan A-G
IDFC Money Manager Treasury A-G
IDFC SSI ST Plan A-G

And then, fill out the STP form to monthly or weekly transfer of fixed amount to IDFC Premier Equity.

regards,
MIK

Dear MRV, Here is the example.

Say u right now have 12K Rs. ready with u to invest in Eq. funds, in normal course, everybody `ll ask u to invest thru SIP of 1K mly for next 12 months.

I `ll advice to invest ur 12K Rs. in a liquid fund of the same AMC where u want to invest in Eq. fund.

Now first invest 12K in liquid fund. After that fill the STP (Systematic Transfer Plan) form to transfer 1K mly from liquid fund to eq. fund. As per ur instructions, the AMC `ll deduct 1K Rs. every month from liquid fund & invest it in Eq. fund. In the process u `ll be able to earn some extra returns from ur liquid fund investment more than ur saving acct. interest.

If u want to continue this, u may just invest more into ur liquid funds & rest `ll be done automatically. As both the funds belong to same AMC, u `ll get a consolidated acct. statement so no need to track for debit of money from ur bank (in case SIP) & u can always gauge the performance & current value of ur investment.

Thanks

Ashal