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A portfolio of diversified, large-cap funds with good track records shows a sound investment approach…

I am 27 and earn Rs 40,000 per month. I am currently investing Rs 5,000 per month in HDFC Top 200, DSPBR Top 100 Equity, Sundaram Taxsaver, Canara Robeco Equity Tax Saver and HDFC Taxsaver. I can further invest Rs 4,000 a month; please suggest a portfolio that I can build.
- Kedar

Schemes  Category  Rating  3-yrs ret (%)  5-yrs ret (%)
Canara Robeco Equity Tax Saver Tax Planning ***** 19.89 20.92
DSPBR Top 100 Equity Large Cap **** 11.95 18.37
HDFC Taxsaver Tax Planning **** 18.01 15.21
HDFC Top 200 Large & Mid Cap ***** 17.24 19.65
Sundaram Taxsaver Tax Planning *** 8.63 14.68
Returns as on June 22, 2011 Ratings as on May 31, 2011

Your approach to investing in mutual funds is good a large-cap and a large- and mid-cap fund which are both good as well as tax planning funds. However, in your exuberance you have invested in three different tax planning funds which results in nothing but duplication of ideas. Moreover, the choice of Sundaram Taxsaver is baffling compared to the other funds that you have invested in. This is a 3-star rated fund, which has been going down with its performance and avoidable. It is not too late; you can discontinue the SIP in this fund and continue investing in the rest. As for additional sum to invest that you have; you can add to your existing investment in these funds and continue investing in them.



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