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Invest With Focus

Plan your portfolio on the basis of the likely time frame of your investments & your risk tolerance…

I have monthly SIP investments of Rs 1,000 in Kotak Gold, HDFC Prudence and Fidelity Tax Advantage besides Rs 500 in Edelweiss Select Midcap Fund. I would like to do one more SIP of Rs 500 or Rs 1,000 every month and am not sure which fund to invest in; please suggest a fund to add to my portfolio.
-Nishid Solanki

Current Portfolio
Scheme   Category  Rating  SIP (Rs)
Edelweiss Select Midcap EQ-M&SC Not Rated 500
Fidelity Tax Advantage EQ-TP ***** 1,000
HDFC Prudence HY-EQ ***** 1,000
Kotak Gold Gold Not Rated 1,000
Data as on November 30, 2011

Your portfolio of four funds lacks focus and has not been planned appropriately. For instance, it is advisable to invest in gold only when one has a well diversified portfolio and that too it makes sense to restrict the exposure to gold at 5-10 per cent of total investments, compared to the 28 per cent that you have at present.
Likewise, one should invest in funds that have a proven track record and performance history; you have made investments in Edelweiss Select Midcap which was launched in August 2011 and is yet to establish itself. We suggest you first think of the likely time frame of your regular investments and your own risk tolerance. Based on these two crucial inputs decide on an asset allocation, i.e. mix of equity and fixed income. Consider funds from our selection of Value Research Fund Select to build a portfolio. Lower your exposure to Kotak Gold to Rs 500/month. Terminate your SIP in Edelweiss Select Midcap. Review your selection at least every year to make changes and rebalance your portfolio to align with your asset allocation.



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