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Defining Goals

Define your goals as clearly as possible to have the best chance of achieving them…

I am 36 years old and have SIPs in HDFC Top 200, HDFC Equity, DSPBR Top 100 Equity and DSPBR Small & Mid Cap fund. I am investing Rs 6,000 in these funds to save for the down payment for a flat 2-3 years later and for my five year old daughter’s education and marriage. Is my investment good? I can invest additional Rs 4,000-Rs 6,000 every month if needed.
- Pawan Kumar

Schemes  Category  Rating  3-yrs ret (%)  5-yrs ret (%)
HDFC Top 200 Large & Mid Cap ***** 15.46 17.1
HDFC Equity Multi Cap ***** 17.95 17.17
DSPBR Small and Mid Cap Mid & Small Cap ***** 15.86 NA
DSPBR Top 100 Equity Large Cap ***** 10.53 15.3
Returns as on April 28, 2011 Ratings as on March 31, 2011

You have made a good choice of funds that are rated high and have a performance track record to go back to. Collectively the funds are well diversified and should augur well for the return on your investment. However, you need to define your goals better than what you have defined. For instance, you need to have a clear sum that you are looking to save for the down payment of the flat and the sum that you are planning to save towards your daughter’s education and marriage which are several years ahead. If you define the need for Rs 50 lakh for your daughter’s education and marriage, it will be meaningful for when tracking the performance of your fund’s performance.

Moreover, the additional sum that you have and plan to invest will also add to your investments if you have a clear set goal. We would suggest you have a clear investment goal for which you are saving and making these investments. That way, when tracking your fund holdings, you will be able to ascertain its performance and where it is headed. This way, you can make necessary course correction to your investments and exit funds if needed to invest in funds that will help you achieve your goal. The fund selection is good and you can invest the additional sum that you have in these funds itself.

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