Dear Ashal, Wadia and Sharma ji,

Last yr i invested in following MF (dividend pay-out option)
BSL Frontline Equity
HDFC-Top200
DSPBR-TIGER
DSPBR-Top100
Kotak-30
Kotak Opportunities
HSBC Equity
Sundaram Select Focus
Reliance Growth

Now, one year has completed. Please suggest shall I book profits or keep these funds or book partly profit.

Thks
Wishes
zapper

You should BOOK Profit one by one in following Funds:

DSP T.I.G.E.R. Fund
KOTAK -30 Fund
HSBC Equity Fund
Sundaram Select Focus Fund

Invest by STP in Follwing Funds

- IDFC Premier Equity/
Small & Midcap Equity Fund

- Sundaram S.M.I.L.E. Fund

- Principal Emerging Bluechip Fund

P.C.Shama

Dear P.C,

If we book the profit and want to invest in a debt fund on a long term, which funds would you suggest like short term debt/long term debt/gilt.

Kindly advise.

Feroz

Dear Feroz,
Interest rates may move up shortly and so it is not advisable to go for longer duration debt funds. Opt for short term debt funds or better still dynamic funds like Birla Sunlife Dynamic fund is best suited for now.
Regards,
Wadia

what about the below funds. Is it advisable

Reliance short term fund
Canara Robeco Income
HDFC short term/high interest

Dear Zapper, Redeem from following funds.

DSP Tiger
K- Opp.
K-30
HSBC Eq.
Sund. Select Focus

Ur remaining funds `ll be -
BSL Fr`line
HDFC Top 200
DSP Top 100
Rel. Growth
The first 3 r large dcap oriented funds & Rel. Growth is a midcap fund. So there is scope for addition of multicap funds like DSP Eq. & Rel. RSF Eq.

From ur total redemption amount, invest in DSP Eq. & REl. RSF Eq. as well as top up in above 3 large cap funds.

After all the adjustment ur total funds `ll be 6. Which is a good no. to observe & follow the performance.

thanks

Ashal

Dear Ashal,Sharma ji,

Thank u very much for the suggestion. Why I should redeem the funds mentioned by you now and not wait for some more time? It would be very helpful if you both can justify your suggestions which will help me understand better in future. Is it the right time to redeem and invest when the markets are high?

Thanks
zapper

Dear Feroz,

You may Redeem UNITS just Equal to Profit only. Dont Redeem all UNITS.

Even Better Option is to OPT For Dividend PAYOUT & Switch Dividend in DEBT Fund directly.

Invest Profit Part in any one or more of Following Funds

- FT India Dynamic PE Ratio Fund of Funds

- Birla Sunlife Dynamic Bond Fund

- Canara Robeco Income Plan
- ICICI PRU Income Oppotunity Fund

- HDFC High Interest Fund Short Term Plan

- Reliance Short Term Fund


P.C.Sharma

I have Mentioned to Redeem one by one because
we DONT know when market will go UP or DOWN.

P.C.Sharma

Dear Zapper, I advised to redeem for following reasons.

U already hold HDFC Top 200, DSP Top 100 & Birla Fr`line Eq. All r well performing large cap funds. At the same time, u r investing in K-30, HSBC Eq. & SS Focus. All these 3 funds r also large cap oriented. So in effect u were investing in total 6 large cap funds. Off late HSBC & SSF r not performing well & K-30 is an aggressive kind of fund. that`s why i advised to redeem to all 3.

DSP tiger is a sectoral/thematic fund. For long term portfolio, ur other funds r also giving u exposure to infra theme so over all no requirement is there to remain in this fund & off late performance is also in question.

K-Opp. is again an aggressive kind of multicap fund. So i advised in favor of DSP Eq. & Rel. RSF Eq. At the same time I also advised to top up in ur remaining large cap funds so that there is a stable base of large cap funds in ur portfolio. preferably around 50-60%.

Thanks

Ashal

Thanks Sharma.

But I have seen the portfolio of HDFC High Interest Fund Short Term Plan & ICICI PRU Income Oppotunity Fund where they have high allocation to GOI securities and currently there are lot of fluctuations on interest rates. Is it still advisable.

But the rest of the funds which you have mentioned has very less allocation to GOI.

Also what are your suggestions if the booked profits invested in MIPS from Reliance/HDFC/Birla considering investing for longer duration ignoring the monthly income option. Do you have think the MIP NAV`s are still high at the current market level or should I option via SIP ( weekly) because i am purcahsing through ICICI direct and can do the transactions on day-day basis ONLINE


Feroz

26-11-2009

Dear Ashal and Sharma ji,

Thanks for the reply and suggestions. Ashal, i agree with you. Why I asked sharma ji about redeeming coz he suggested to someone back in Feb in one of his posts to invest-

-For 15 years, Sundaram Select Focus Fund is GOOD.
-For 20 years, Kotak Opportunity Fund is GOOD.

If we redeem funds say after 1 year like in my case then where is the logic of suggestions provided by experts who say to keep MF atleast for 3 to 5 years. I dont want to argue but i wish to understand the funda of rebalancing and the right time of rebalancing. I invested in Sund Select Focus when it was suggested and same for other funds and when they were doing good but now Sundaram Select, K-30, K-Opp, DSPBR-Tig, HSBC-Eq are not performing well. So what i understood is one should rebalance as soon as the fund starts to underperform. Is this correct?
dear ashal, i clearly understood what you explained about K-Opp and DSP-tig.

thanks
zapper

Dear Feroz,

Your observations are correct.

You may Invest Profit Redeemed from Equity Funds in MIP. There is no need to BOOK Profit from MIP Funds untill you need money foe Expences.

I Prefer of Reliance MIP & HDFC MIP(LT)

I DONT give importance to NAV. However
if you feel market is likely to go DOWN, WEEKLY SIP/STP is preferable.

P.C.Sharma

Dear pcspune,
Is there weekly SIP?? Which AMC ???

Dear sp.palo

Yes there is weekly SIP which is offered by DSPBR Fund house It is not exactly weekly SIP but it allows SIP on the designated dates ie 1st, 7th, 14th and 21st of every months.uner the same folio .

No even daily SIP is also available by Bharti Axa.

Regds

Ashport