VR Logo

Importance of a Core

Without a core holding & with two thematic funds, your portfolio is high on risk…

I have SIP investments in HDFC Prudence, Reliance Diversified Power Sector Fund and Reliance Natural Resources. I want to switch to better performing funds, please suggest funds that I can invest in for the next 6-8 years.
Pradeep Solanki

Fund   Category  Rating  3 Yrs Ret (%)
HDFC Prudence Hy: Equity-oriented ***** 19.63
Reliance Div Power Sec Eq: Others Not Rated 3.86
Reliance Nat Resources Eq: Others Not Rated 2.17
Return as on September 22, 2011, Rating as on August , 2011

Your portfolio of three funds does not reflect any character. Though HDFC Prudence is a very good equity-oriented hybrid fund, the other two funds are thematic funds which are very risky. You have no core holding and out of three funds, two are from the same fund house.
Continue with your investment in HDFC Prudence. It is a very good fund in its category. Discontinue your systematic investments in the other two funds. Pick up one fund from the 'Equity: Large Cap' category such as DSPBR Top 100 or Franklin India Bluechip and another from the 'Equity: Large & Mid Cap' category such as HDFC Top 200 or Fidelity Equity.
The lesson for you is to focus on building a core portfolio and add thematic funds to it only when they offer a compelling idea or provide balance to your portfolio.

Post Your Query