[Latheesh]

Originally Posted by daretodream

So, the funds are lying idle in savings account for 14days-30 days.

Why complicate simple things. You need that money in 15 days, just leave it alone!

[Ferrari1976]

Originally Posted by daretodream

So, the funds are lying idle in savings account for 14days-30 days.[/b]

Move to IndusInd, their savings account interest rate is close to liquid fund returns.

[graaja]

Originally Posted by daretodream

Folks - looking for suggestion on managing the funds meant for SIP.

Yes. This can be done.

1. Create an SIP into a liquid or ultra short fund for the full amount at the beginning of every month.
2. Create STP (systematic transfer plan) from this ultra short fund into the equity funds.

There are a few considerations. If you are dealing with funds from the same fund house, then the SIP into the ultra short fund can be a single transaction. But if your equity funds are split across multiple AMCs, you will have to create multiple SIPs into ultra short funds of each AMC and then do an STP.

Like others have said already, the difference in interest rate of savings account and SIP will make significant difference only if you are dealing with very large sums. Otherwise, it is just a hassle.

[chennai-indian]

Originally Posted by pkulkarni.2106

Hello all,

To be honest, my knowledge in mutual funds is next to none (yes, I regret being late and not investing early).
Thinking better late than never, I'm willing to invest in mutual funds and want to know more about how expert here on T-BHP do invest:

- I've identified a couple of short term goals (e.g. a car & a trip abroad), a couple of long term goals (e.g. child's higher education & corpus for my retirement). Along with these goals, there's a recurring goal (for the lack of precise word), such as kid's school fees and other expenses.
- So the question to experts here is - how do you shortlist mutual funds for short term and long term? What's the criteria for choosing a mutual fund for short & long term investment?
- Is there any category which I can invest in for the recurring goal?
- I came around this app - Black by Cleartax. Has several plans for each goal - looks good to me, but wanted to see if anyone has tried it and reviews if any.

Your guidance is appreciated!

Depends on what your definition of short and long-term are. Here s the classification that I follow:
0 to 3 years - Short term - Better off with an FD or recurring deposit. Don't bother about a mutual fund

3 to 5 years - a long-duration debt fund or a hybrid fund.

5+ years - Equity fund. I prefer an index fund. If you want to go the managed fund route, suggest the fund from Parag Parikh AMC.

As for the platform to use, I use Kuvera - www.kuvera.in - Like the UI, features and is totally free. Also, all the funds are direct funds.

[adimicra]

Originally Posted by chennai-indian

Depends on what your definition of short and long-term are. Here s the classification that I follow:
0 to 3 years - Short term - Better off with an FD or recurring deposit. Don't bother about a mutual fund

3 to 5 years - a long-duration debt fund or a hybrid fund.

5+ years - Equity fund. I prefer an index fund. If you want to go the managed fund route, suggest the fund from Parag Parikh AMC.

As for the platform to use, I use Kuvera - www.kuvera.in - Like the UI, features and is totally free. Also, all the funds are direct funds.

This is not the correct advice, IMO.

First of all when thinking of investment horizon, always work backwards from the date you will need the money and always maintain asset allocation. So, even if you have 15 years for investment, still do not put everything in equity. I won't advise more than 60% in equity for anyone unless you are probably in your 20's and your corpus is very low and you don't have to worry about needing the money for several decades.

For less than 3 years, short term debt funds will work and give you better tax-adjusted returns than FD.
For 3-5 years, equity is too risky. I would mainly focus on debt or may be a conservative hybrid fund which invests >75% in debt. You can have 2-3 funds as long as your overall equity allocation is less than 20-25%
For 5-7 years, you can go for 40-50% equity and rest debt
For >7 years, you can invest 60% in equity and rest in debt.

[chennai-indian]

Originally Posted by adimicra

This is not the correct advice, IMO.

First of all when thinking of investment horizon, always work backwards from the date you will need the money and always maintain asset allocation. So, even if you have 15 years for investment, still do not put everything in equity. I won't advise more than 60% in equity for anyone unless you are probably in your 20's and your corpus is very low and you don't have to worry about needing the money for several decades.

For less than 3 years, short term debt funds will work and give you better tax-adjusted returns than FD.
For 3-5 years, equity is too risky. I would mainly focus on debt or may be a conservative hybrid fund which invests >75% in debt. You can have 2-3 funds as long as your overall equity allocation is less than 20-25%
For 5-7 years, you can go for 40-50% equity and rest debt
For >7 years, you can invest 60% in equity and rest in debt.

Personal finance is personal so any advice should always be taken based on one's specific circumstances. For less than 3 years, a Short term debt fund is riskier than an FD. You will have interest rate risk, credit risk, and default risk. So for such a short duration, FD is a better option IMHO. For 3 to 5 years, what you are advocating is exactly what I also said - Hybrid funds. For > 5 years, depending on one's risk tolerance, one can go for a mixture of equity and debt or pure equity. I favor pure equity.

[born_free]

I have been investing in Mutual Funds for close to 14 years now.

Some of the strategies that I follow are mentioned in article below by valueresearch which published my story on its how I did It segment.

https://www.valueresearchonline.com/...-independence/

Also sharing link of a portfolio which I created for a colleague, has both equity and debt funds recommendation, where I also explain the reasoning backed up with data

https://drive.google.com/file/d/1z_K...ew?usp=sharing

[FrodoOfTheShire]

Originally Posted by born_free

Some of the strategies that I follow are mentioned in article below by valueresearch which published my story on its how I did It segment.

Thanks for sharing! Going through the VRO article I noticed you've mentioned - "I am therefore working on a tool which will calculate the number of units required to sell a mutual fund so that LTCG is tax free"

I use Niyo Money (formerly known as Goalwise) to invest in direct MFs. The platform has the tool built-in which you're trying to create. Maybe you can have a look if that works for your requirements.

[born_free]

Originally Posted by FrodoOfTheShire

Thanks for sharing! Going through the VRO article I noticed you've mentioned - "I am therefore working on a tool which will calculate the number of units required to sell a mutual fund so that LTCG is tax free"

I use Niyo Money (formerly known as Goalwise) to invest in direct MFs. The platform has the tool built-in which you're trying to create. Maybe you can have a look if that works for your requirements.

Thanks, I will check that out, I assume you need to invest through the platform to get the LTCG calculations.

I primarily invest through direct MF website .

I want the tool to be more generic so that any one can upload their CAMS Transaction file and get the results irrespective of how they invested .

70% work is done, I just need some reliable way to read the the pdf transaction file and parse data in python programming language.

This is also a passion project for me to practice my software engineering skills.
Later I plan to create a full fledged website for portfolio evaluation/planning/recommendation. etc.

[adimicra]

Originally Posted by chennai-indian

Personal finance is personal so any advice should always be taken based on one's specific circumstances. For less than 3 years, a Short term debt fund is riskier than an FD. You will have interest rate risk, credit risk, and default risk. So for such a short duration, FD is a better option IMHO. For 3 to 5 years, what you are advocating is exactly what I also said - Hybrid funds. For > 5 years, depending on one's risk tolerance, one can go for a mixture of equity and debt or pure equity. I favor pure equity.

Yes, it's personal but there are some time tested principles which work.
If someone wants to not have any risk of interest rates or credit risk etc, then they should not invest in ANY debt funds.The risk related to credit or default etc applies to any debt fund, whether short term or long term debt fund (which you seem to be recommending). They should stick to FDs from top-tier banks only.
If you go short term funds with maturity around 1 year, the interest rate risk is minimized if you stay invested for more than 3 years. To reduce credit or default risk , look for short term funds with very high proportion of AAA bonds. Based on historical data, short term debt funds have given much better tax-adjusted returns for 3-5 yr periods than FDs.

As for pure equity, it's your money and your choice but as a general rule, the most important aspect of investing is asset allocation and maintaining a balance between equity, debt and gold (possibly). So, if someone wants a rollercoaster ride with 100% equity, then it's fine but that can't be a general advice or guidance.

[rajesh1868]

I had been a very irregular investor for the past many years. Since I had to mostly break my investment and redeem in between, never had a disciplined approach.
I managed to close all my emis recently and plan to invest a portion of monthly savings in SIP as long term investment.

Are these a good Mix?
Axis Focused 25, Mirae emerging bluechip, Invesco India midcap, Sbi small cap, SBI Equity hybrid.

I just went and selected some funds that appears to provide decent returns. If these are good, what should be an ideal ratio between these. Do I need to remove any? Include something else? Tax saving is not needed so haven't checked that

I have not included Debt as I did not understand the difference between long term, ultra short term etc. Need advice here on how to select this.

In case it matters: I am just over 40 years. Have 2 kids.

[rachitarora1985]

Thanks for the real life examples. I will surely try this with a small amount before taking bigger strides when the markets fall.

[audioholic]

Originally Posted by rajesh1868

SBI Equity hybrid.

My investments in Mirae Asset Equity Hybrid have consistently outperformed SBI Equity Hybrid over the last three years. Hence between the two, I would pick Mirae especially when you already are investing in their Emerging Blue chip fund. But they have limited investments in Emerging bluechip and I think now its a max of 2500 per month, correct me if I am wrong. But with this fund, the market Beta was quite high during last years crash and had suffered the most. Similarly, now its the fund with the highest returns in my basket.

In fact, my investments in Mirae have given far higher returns, both absolute and XIRR compared to the investments made in SBI Mutual fund over the same time period. Only difference being lesser allocation to Mirae which I now regret.

[born_free]

Originally Posted by rachitarora1985

Thanks for the real life examples. I will surely try this with a small amount before taking bigger strides when the markets fall.

Saying from personal experience, you will start with small amount, in some years you will be happy with performance of your portfolio and then wonder why did not you put enough money initially .

Having said that its always good to asses your risk appetite upfront and stick to it. Allocate the money that you don't need for at least 7 years and put it in Equity MF, via SIP.

Waiting for market fall is not guaranteed to work, markets can remain stagnant for long periods or move on narrow band, or even start going up and up.

Even if it starts falling, there is no way to know the bottom and you will be left guessing.
That's why investing in SIP is good idea which insulates you from volatility.

In my 14 years of investment there was never a time when I needed to withdraw money for other use.
This helped me to face two major stock market crashes, and come out even stronger as I could take advantage of it .

[ghodlur]

Experts need your views on Birla Sunlife Frontline Equity fund.

Although the returns have been positive, but not in the same league as Mirae Asset Emerging blue chip or Axis Blue chip or ICICI Prudential bluechip. Any reasons for the fund to lag behind the leaders?

I have a SIP in the fund and come September the SIP will need renewal, hence thinking.