I am investing in HDFC Top 200, Franklin India Bluechip, Reliance Vision, ICICI Pru Discovery, ICICI Pru Dynamic, HDFC Balanced, IDFC Premier Equity and IDFC Sterling for the past one year through SIPs. What is your opinion on my portfolio?
- A Mitra
Your portfolio of 8 funds has 88 per cent equity exposure with a large-cap growth orientation and investments in 200 stocks. The top five stocks account for 17 per cent allocation, which includes ICICI Bank, Infosys, Reliance Industries, Bharti Airtel and State Bank of India; the top three sectors are Finance, Energy and Healthcare and account for 37 per cent of the portfolio. Although the portfolio is well-diversified, you can reduce the number of holdings to do away with redundancies and overlaps. Remember, portfolio diversification can be achieved through the right mix of funds across categories than going with more number of funds. For instance, there are three mid- and small-cap funds as well as large- and mid-cap funds and you can easily reduce these overlaps. Likewise, if you can take the risk, you should do away with the large-cap fund and add a multi-cap fund to increase portfolio diversification and style. Invest regularly for the long-term.
This article was originally published on September 07, 2012.
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