Hello,I’m a long term investor with a perspective of at least 10 years. How many Large Cap funds should one have? Sundaram Select Focus, DSP Top100, HDFC Top 200 & Birla Frontline Equity – should one have all these 4 Large Cap Funds or any 1, 2 or3? My Portfolio comprises 2 Large Cap Funds – Sundaram Select Focus & DSP Top100 (out of total no. of 6 funds). If I add HDFC Top 200 & Birla Frontline Equity to my Large Cap funds, wouldn’t it be like buying the same shares; bcoz the FMs of these Funds might have bought almost similar shares. Kindly advise.
Long Term Investor
Dear friend, Normally an investor should have following break up in terms of total no. of MF plans.
3 Large cap
1 Mid cap
2 Multicap, diversified, opportunity
1 speciality fund (here i mean gold funds or global funds to reduce over all risk).
total 8-9 funds r sufficient in any portfolio for a long term growth. the large cap funds should form the core of ur portfolio, hence the over all exposure to this category should be around 50-60%
Mid cap 10%
Multicap – 15-20%
Sectoral – 5-10% but zero before 3-4 years of retirement.
Balanced – initially zero if investors age is in 20s & should increase with age & by the time the person retires, it should be around 40%.
Speciality – 10% of ur initial portfolio.
Plz. note i have not used the word Ideal, as nothing can be ideal for everybody. U may take ur own break up & invest accordingly to reach ur goal post.