I am in my early 30’s a moderate risk taker and working in banking sector. At present,I have three SIPs namely SBI Bluechip, Franklin Focused Equity (₹2,500 each) and Axis Long-term Equity (₹5,000). Please validate my portfolio and advise what needs to be done in accumulating a corpus of ₹2 crore 20 years from now.
— Bikramjit Dutta

To accumulate a corpus of ₹2 crore in 20 years, you would need to invest approx. ₹15,000-17,000 p.m. (assuming a CAGR of 14% ). Stick to investing in Equity Schemes despite having a moderate risk profile as investing via SIPs reduces the volatility associated with equity investing. The respective allocations and the schemes in which you are investing are fine and you may continue with the same.

Is it desirable to invest a lump sum in MFs now particularly when Sensex and Nifty have peaked and going forward, possibilities of further peaking is limited? Or is it desirable to split the corpus and go for SIPs?
-K V Rao

Investing via SIPs or STPs helps in achieving the objective of “rupee cost averaging” and is an effective tool to ride the volatility in equity markets. Investing via “lumpsum” is essentially aimed at putting your entire money to work from day one and seek the benefits of “compounding”. Needless to say, investing via lump sum does not ensure that the market will go up from the next day itself. Finally, trying to time the market is a futile exercise and it is not possible to predict the same. However, your question has your answer in it. If you believe that the markets have peaked and further rise does not seem possible, then you should not invest via lumpsum. Invest via SIP.

I am a 21-year-old student and want to invest in mutual funds. Looking at a long-term perspective and considering the current situation of the economy, could you please suggest some of the chief choices to begin with ?
-Kritika Sharma

Begin investing with either a Hybrid Fund or an Equity Index Fund. Since you are looking to invest for the long term, I would suggest go ahead with Equity Fund. Invest in IDFC Nifty Fund or HDFC Index Fund Sensex Plan. Choose Growth option. Invest via SIP.

I am an NRI. I have a query on the capital gain taxation on Mutual funds. During the current financial year i.e. 2019-20, I made long-term capital losses on equity MF. Now I have some debt and gold mutual funds, if i sell them now then I will make long-term capital gains (holding for over three years) on them. My question is, can I set-off the long-term capital gain on gold/debt mutual fund with the long-term capital loss on equity mutual funds?
– Sunil Jhunjhunwala

Yes, long-term capital loss from equity investment can be set off against long-term capital gains from gold/debt investment.

(Answered by: Harshvardhan Roongta, CFP, Roongta Securities)

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