Good Time For Lumpsum Investment? | The Mutual Fund Show | NDTV Profit
- How to make your portfolio election-ready?
- Top #mutualfund themes ahead of #LokSabha polls
Tamanna Inamdar in conversation with Germinate Investor Services' Santosh Joseph and Optima Money Managers' Pankaj Mathpal on 'The Mutual Fund Show'.
- Top #mutualfund themes ahead of #LokSabha polls
Tamanna Inamdar in conversation with Germinate Investor Services' Santosh Joseph and Optima Money Managers' Pankaj Mathpal on 'The Mutual Fund Show'.
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TVTranscript
00:00 (upbeat music)
00:02 - Welcome, you're watching the Mutual Fund Show
00:13 on NDTV Profit.
00:14 I'm Tamannah Anamdar,
00:16 and this is the show where we bring you insights
00:19 about what you should do with your investments
00:23 in the mutual fund industry.
00:24 What should your portfolio look like?
00:26 Should you rejig it?
00:27 What are the various options available?
00:29 Now, the topic we've picked for today is pertinent
00:33 because we are now in poll season.
00:35 You would be wondering what that has to do
00:37 with your mutual fund selections
00:38 or your mutual fund portfolio.
00:40 It would turn out quite a bit.
00:43 You are going to be seeing reactions
00:45 in underlying equities over the next few weeks,
00:49 before and after the elections,
00:51 depending on what the results are.
00:52 While the results for political continuity and stability
00:56 are largely priced in, what happens
00:59 if that's not what we see?
01:01 What are the kind of stocks and sectors
01:03 which will be buzzing?
01:04 And what can you do as a mutual fund investor about this?
01:09 Can you make the most of it?
01:10 Should you just leave your investments alone?
01:12 And what are the various options?
01:13 These are some of the things
01:14 that we're speaking about today.
01:16 And to talk on this, I'm joined by Santosh Joseph,
01:19 who's founder of Germinate Investor Services,
01:22 and Pankaj Matwal,
01:23 founder and CEO of Optima Money Managers.
01:26 Welcome to both of you.
01:27 And thank you so much for speaking with us here
01:29 at NDTV Profit.
01:31 Let me begin, Santosh, with your take
01:33 on the topic we've picked.
01:35 Because I know the basic intelligence
01:40 is that continue your SIPs as always,
01:43 don't look at events coming and going,
01:44 but this is a big event.
01:46 This is a big event that will have an impact,
01:49 and perhaps positive impact,
01:51 on the markets and various sectors.
01:52 Why should mutual fund investors
01:54 also not make the most of it?
01:55 - No, they should.
02:00 This is a big event,
02:01 and the common wisdom is to stay invested,
02:06 because this is an event that comes once in five years.
02:09 And we've also known from the past history
02:12 that whenever elections are there,
02:13 the subsequent number of months and years
02:16 are actually very rewarding for mutual fund investors.
02:19 And therefore, there's this tendency to think
02:21 that can I do something different,
02:22 something exciting, something adventurous,
02:25 to make the most of the exciting poll season ahead of us.
02:29 But I think this is where rationality
02:30 and prudence should come in.
02:32 Stick to your guns if you're an investor already,
02:35 stay invested.
02:36 Now, if you're not started your journey,
02:39 this is a great time to again,
02:42 take a fresh look at investing,
02:44 stagger your investments, and go for it,
02:46 because if the elections go well,
02:49 and if the markets are set in tone,
02:52 you've got good long run way ahead of you.
02:54 - You know, it's also a great idea
03:00 to just look at if you have lump sum investments,
03:04 is this the time to do it?
03:05 And let me come to you on that, Pankaj Matpal.
03:08 If you have a lump sum investment at this time,
03:10 and you know, wondering whether you should wait
03:12 for before elections, after elections, before deploying,
03:16 is that a factor that comes into play?
03:18 - Yes, I agree with you.
03:20 First you have to see what are the financial goals.
03:24 So based on goals, you invest in diversified funds
03:28 for long term.
03:29 But at the same time, as you mentioned,
03:31 if you have additional funds available with you,
03:33 and you want to take advantage of that event,
03:36 then definitely you can consider,
03:38 and if you talk about this election.
03:42 So we know that government has a focus
03:46 on making India infrastructure.
03:49 So sectors which can get benefit
03:52 out of these government's plan can be considered.
03:56 So one thing is that for a long term,
03:58 as per a financial goals,
03:59 you should invest in diversified funds.
04:01 But at the same time, as you mentioned,
04:03 you have lump sum amount available,
04:05 or you want to make best use of this.
04:08 So in that case, some sectors can be considered.
04:12 So sectoral funds or thematic funds,
04:14 especially as I mentioned,
04:16 things like manufacturing teams,
04:18 or PSU teams, defense teams, or infrastructures,
04:23 this kind of funds can be added to the portfolio.
04:27 But you have to understand one thing,
04:29 that any team is not for a very long term.
04:32 So once the team plays out, you have to exit.
04:35 So you have to make two portfolios.
04:38 I mean, one is a portfolio for a financial goal.
04:42 At the same time, for this event,
04:44 you can have some fund which you can allocate it
04:48 to get benefit of this.
04:50 - Okay, you know, let me take that question
04:52 to Santosh as well.
04:54 Is this a good time to deploy a large amount
04:57 or a lump sum amount ahead of elections?
05:00 - So I think first and foremost,
05:04 if you have the money to invest right now,
05:05 it's a great time.
05:07 The only question is,
05:08 do I want to just put the money at one go,
05:10 or do I want to stagger it?
05:11 I think it just makes so much more sense
05:14 that if you have the money, you're in a great spot.
05:16 Stagger it within the next maybe two, three months.
05:19 Always, whether there was elections or not,
05:21 staggering is a great opportunity, number one.
05:23 Number two, we've also realized that elections come,
05:26 at least the general election come once in five years.
05:29 Now, whether you stagger,
05:30 or you just put the money at one lump sum,
05:33 if you're going to be mindful of the time horizon
05:36 that you're investing,
05:37 and the purpose that you're gonna invest in,
05:39 then even for some reason,
05:42 someone just took a blind one-time bet on the market,
05:44 it will still, I think, reward you over a five-year period.
05:47 Remember, election come once in five years,
05:49 and there's the least time frame you should come into
05:52 in the markets, into investing in equities,
05:55 even though you're gonna do it with mutual funds,
05:57 you still need to give it that four, five-year time frame.
06:00 As much as you'd like to give time
06:01 for the government to prove itself,
06:02 you need to also give time for your investments to prove.
06:05 And like I said earlier,
06:08 post-election years are generally rewarding,
06:10 and it may benefit the investor.
06:12 - Yeah.
06:13 Obviously, you have to give a time frame.
06:16 No one is suggesting you play this like a stock market trade.
06:20 The question is that,
06:21 can you make the most of this large event?
06:23 So then let me come to the next leg of it.
06:25 What are the kind of funds that one should look at?
06:28 There are a score of thematic funds
06:30 that have now become available.
06:32 Many of them have launched over the last couple of years.
06:35 And Pankaj, let me come to you on that point.
06:37 Thematic funds like PSUs, focusing on PSUs,
06:40 focusing on defense, focusing on infra.
06:45 And these are generally the themes
06:47 that start showing a lot of reaction ahead of elections.
06:50 Would it make sense to go in
06:52 for some of these thematic funds
06:54 or stick to the bread and butter?
06:56 - See, as I mentioned earlier, the same thing.
07:00 See, your portfolio should have diversified first
07:04 because whichever government,
07:07 but economy will grow and capital markets
07:09 will deliver good returns.
07:11 So you should invest in diversified funds.
07:13 But at the same time,
07:15 if you're expecting that any government
07:18 which focuses on particular sectors, themes,
07:22 based on that, you can pick some thematic funds.
07:24 So like defense, PSU, manufacturing, infra,
07:29 these are good themes,
07:32 but again, it depends that who forms the government.
07:36 So based on your expectation,
07:40 you can take a call,
07:41 but after election,
07:42 when you are sure that once you know
07:44 that who's forming the government
07:46 and what kind of reforms decisions will be taken,
07:51 based on that also, you can pick right themes.
07:54 - You're saying wait, wait for after elections, Pankaj?
07:58 - See, again, as I said,
08:02 first thing your expectation,
08:03 what are you expecting that who will form the government?
08:05 And what you expect from that government?
08:08 Which party I mean,
08:10 if you're expecting NDA or India Alliance,
08:13 so what kind of strategies
08:16 or what expectation you have from them?
08:19 So if you're expecting that a particular alliance
08:22 will form the government,
08:23 particular party will form the government,
08:26 and you believe that what kind of development
08:28 you expect from them,
08:29 based on that, you can pick the themes.
08:31 Or second is that if you're not sure,
08:34 then of course you have to wait
08:36 and watch after election results are out,
08:38 and based on that, you can take decisions.
08:41 - You know, now that's asking for political punditry
08:45 from investors that everyone may not be able to do,
08:49 frankly, a lot of people may speculate,
08:51 no one knows what's gonna happen till it happens.
08:53 Now, the smartest investors make the bets before the event,
08:58 and that's how they make the most of it.
08:59 So Santosh, coming back to that question,
09:01 thematic funds or be safe with,
09:03 say, a multi-asset, multi-cap or a flexi fund?
09:07 - So I'm not saying safe,
09:09 but I think it's just practical
09:12 to be in diversified funds in the flexi cap, multi-cap,
09:15 or I think now you rightly alluded also
09:17 that multi-assets are becoming very critical
09:20 to people's portfolio.
09:21 Now, why do I say what I say is that though we do have
09:25 now a lot on offer, a lot on choice
09:28 as far as specific thematic stories are concerned,
09:32 and some of them do have the ability
09:34 to give you a quick fire return,
09:36 but the fact remains that we should actually step back
09:39 and think just beyond the elections.
09:41 Now, we are in a vibrant, growing economy.
09:44 Now, the more your portfolio is diversified,
09:47 the more your portfolio has got a more broad-based view,
09:50 you actually get a much better risk-adjusted exposure
09:53 in a diversified equity fund,
09:55 like a flexi cap or a multi-cap
09:56 or even a multi-asset category.
09:58 Now, for an investor, let's avoid this entire euphoria
10:03 about markets and sectors and pockets of growth
10:07 that may happen due to one political dispensation
10:10 or the other.
10:11 Let's structurally look at the India economic idea
10:14 that is there on place.
10:15 And like you said, let's not bet on who's gonna win or not.
10:18 Let's bet on the economy because the economy is sure to grow.
10:21 - Absolutely.
10:24 Let's start with what Sudhir is saying.
10:26 Sudhir is aged 49 years and says that,
10:29 "I started a SIP, an SIP of 1000 rupees a month
10:32 in the HDFC Flexi Cap Fund about six months ago.
10:36 I also do a top-up of 100 rupees a month
10:39 along with the existing SIP amount.
10:42 Is it a good idea?"
10:43 It's an interesting strategy for sure.
10:45 Pankaj, you want to feel this first?
10:47 - Yes.
10:49 See, Tamanna, the fund is very good.
10:51 We talk about Flexi Cap Fund, HDFC Flexi Cap Fund.
10:54 This is one of the oldest funds in this category
10:57 which was HDFC Equity Fund earlier.
10:59 And later it was restructured as HDFC Flexi Cap.
11:04 And it has consistency in its performance.
11:08 Roshi Jain is the fund manager
11:10 who is a very brilliant fund manager, I'd say.
11:12 So fund is very good.
11:14 Now, second thing that 1000 rupees per month
11:17 and increasing by 100 rupee every month,
11:19 my suggestion, if Sudhir has money available with him,
11:23 because we do not expect anybody's salary or income
11:28 growing month after month.
11:31 So in this case, it will be better that he invests
11:34 amount every month, same amount, at least for one year.
11:38 And this step-up should be every year.
11:41 So if Sudhir can invest more than 1000 rupees every month,
11:44 he should invest that.
11:45 And every year, he should step up by 10%, 15%
11:49 or by a fixed amount.
11:51 That will be better than increasing by 100 rupees every.
11:54 - Let me give you more bang for your buck.
11:58 Santosh, you have any take on this methodology?
12:01 - It's a phenomenal idea to do the SIP and also add.
12:06 And we have enough data.
12:08 So we have enough data to prove that when you do an SIP
12:12 and when you also add an ad hoc amount consistent
12:16 with the SIP, that the results are almost double
12:19 in terms of how you can make money.
12:20 Good fund, good SIP and good top-up strategy
12:24 is always a winning combination.
12:25 - All right, let's go to our next question.
12:30 This is a good idea, Sudhir.
12:31 So you have the thumbs up there.
12:34 Dharanesh has written to us, he's 25 years old,
12:37 says that they are planning to start a 1500 rupees SIP
12:40 in six particular funds and increase the investment amount
12:44 annually by 10%.
12:46 I want to know if I have chosen the right funds
12:49 and should I change any of them?
12:50 So now the names of the funds on your screen,
12:53 Nippon India Nifty 50, Value Index Fund,
12:56 Access Small Cap Fund, UTI Nifty 200,
13:00 Momentum 30 Index Fund and Quant ELSS Tax Saver Fund
13:04 are some of them, Motilal Oswal NASDAQ 100,
13:07 FOF Direct Growth and SBI Contra Direct Plan Growth.
13:11 So quite a well-rounded sort of number of funds.
13:15 The question is, and I'll come to Pankaj first,
13:17 are there just too many in his portfolio?
13:19 - Yeah, there are too many
13:22 because the amount of investment is not that large.
13:25 One more thing, the manna here, mid-cap is missing.
13:28 See, there are passive funds as well as active funds,
13:32 but if you see all the funds, mid-cap is missing.
13:36 But two large-cap funds, though these are factor investing,
13:40 my suggestion will be that if this is Nippon India
13:44 Nifty 50 Value Index Fund with Motilal Oswal Mid-Cap Fund
13:49 or any other mid-cap fund,
13:52 that will be better for making it well diversified.
13:56 And yes, as in this question,
13:58 he has mentioned that he wants to increase his SIP
14:01 by 10% every year.
14:04 It appeals better to me compared to investing 100 rupee
14:08 every month increasing.
14:10 So this kind of strategy,
14:11 if you are topping up your investment every year
14:13 with a larger amount,
14:15 and at the moment, if you have larger amount to invest,
14:18 waiting for one month to increase 100 rupees,
14:21 better you start with a larger amount initially.
14:23 So this looks a good strategy.
14:26 Only thing, mid-cap is missing, it should be there.
14:29 - Okay.
14:30 You know, just taking that question to Santosh as well,
14:34 there is a clear strategy here
14:35 and six specific funds as a NASDAQ FOF as well,
14:39 which shows that, you know,
14:41 this viewer likes to keep their exposure
14:44 very equitably distributed.
14:46 But do you agree with Pankaj's take
14:48 that not enough of a mid-cap exposure there?
14:50 - Well, I agree with Pankaj
14:53 and also from the investor's perspective,
14:55 while it's commendable that you're starting to,
14:58 and trying to invest and taking the effort
15:00 to list on a broad list of funds,
15:03 but my suggestion is irrespective of the quality of the funds
15:07 and considering equity is a good target scheme,
15:10 stick to just two or three.
15:11 You know, as you mature, as you age,
15:14 and as you progress in your investment journey,
15:17 you can, you know, then add on funds
15:19 which add value to your overall portfolio.
15:22 Now, putting too many good schemes for a certain amount
15:26 just to be erring on the side of caution
15:28 is not a great idea to begin with.
15:30 I think a quantum of this SIP,
15:33 maybe to spread it to maximum three is a great idea,
15:37 even your increase should be done in the same funds.
15:39 And when your ticket size or your appetite
15:42 or the need for exposure grows up,
15:44 then we can, you know, time to time add another scheme.
15:47 Now, no point of, you know, spray painting,
15:50 better to be focused.
15:51 - No point of spray painting.
15:54 So out of these six, then Santosh,
15:56 which are the ones that you'd cut out
15:58 or which are the ones you'd keep?
16:00 - I would just go with the, you know,
16:02 there's a good combination here
16:04 between active and passive funds
16:05 and considering your starting right now,
16:07 it's better that you go with the active funds
16:10 and then maybe later add the passive funds.
16:12 So I think the list,
16:13 I don't have a problem with the list.
16:15 I'm only saying, keep it simple,
16:16 add not more than two or three,
16:19 go with the active ones right now
16:20 because you will see maximum value there also.
16:23 - Yeah, okay.
16:24 Srijan has written into us, he's 20 years old
16:28 and the goal is lump sum returns.
16:30 Says, I would like to invest 2.5 lakh in mutual funds.
16:34 Can you guide me to add the right funds to my portfolio?
16:37 So that's fairly broad ended in terms of a question.
16:41 So there's 2.5 lakh rupees.
16:43 How do you suggest he deploy it?
16:44 Pankaj, let me start with you.
16:46 - Tamanna, see one thing missing that he's investment horizon.
16:51 So 2.5 lakh, if he wants to invest for long term,
16:54 then definitely I would suggest
16:56 that he should invest in a diversified manner.
17:00 He should have a large gap, mid gap, small gap,
17:02 everything can be there.
17:04 But if he wants to invest for less than five years,
17:06 for example, in that case, hybrid funds
17:09 like a balanced advantage fund
17:11 or aggressive hybrid funds can be a good choice.
17:15 So here I assume that he wants to invest for long term
17:17 because that I'm assuming because not mentioned there.
17:21 So considering that, two funds I would recommend to him.
17:25 One is ICICI Prudential FlexiCap Fund,
17:28 which has a scope of investing across the market segments.
17:32 And other fund will be IIT Birla Sunlight VestiCap Fund,
17:35 which invest in large gap, mid gap, small gap,
17:38 all three segments all the times.
17:41 So these two funds, which will provide him allocation
17:46 across large gap, mid gap, small gap.
17:49 And as I mentioned earlier, should be a long term goal.
17:52 - All right.
17:54 So, just let me take that question to Santosh as well.
17:58 How do you suggest that Shrujan invest his money
18:03 and should it be half of each into funds
18:06 or break it up into several funds?
18:08 - Well, to begin with, this gentleman is in the best
18:12 of both worlds to be at age 20 and to have money to invest
18:16 and also at a time like this when we have a vibrant economy.
18:20 Now, my simple knowledge with this limited information
18:25 that we have is that considering his age,
18:28 I think he could straight away begin with a well-rounded,
18:31 diversified multi-cap or FlexiCap fund.
18:33 Now in this category, we all know
18:35 that we are actually spoiled for choice.
18:37 We've got many large tried, tested funds with track record.
18:41 In fact, early in the show,
18:42 we also spoke about another query
18:44 about the HDFC FlexiCap Fund,
18:46 whether it's HDFC or ICICI.
18:48 Most of them have a big AUM, large track record,
18:52 huge amount of wealth created for investors.
18:55 So you start with that journey.
18:57 Considering you're starting young and starting early,
19:00 stay put in this investment
19:02 because the nature of FlexiCap and multi-cap
19:05 gives you a well-rounded across the market exposure
19:09 to equities and therefore I think
19:11 if you're gonna be patient enough,
19:12 you will be well rewarded.
19:14 - Okay, well, patience and reward to patience
19:17 is something Akshaya is also hoping for.
19:19 Our next viewer who's written in is 34
19:22 and the goal is their child's education.
19:26 Says, "I'm investing in a few funds
19:27 "and saving for a horizon of 10 years.
19:30 "I would like to accumulate 75 lakhs
19:32 "for my child's education.
19:33 "Are these funds the right choice for SIP?"
19:36 And he lists them out.
19:38 There's HDFC Balance Advantage Fund,
19:40 5,000 rupees is what he's putting in.
19:43 HDFC Multi-Cap Fund, another 5,000 rupees.
19:46 SBI Blue Chip Fund, 10,000 rupees.
19:48 And the Parag Parikh Conservative Hybrid Fund,
19:52 10,000 rupees, a noble goal.
19:54 And you're thinking way in advance,
19:57 that's great going Akshaya.
19:58 Let me come to Pankaj first for your take
20:00 on whether this is the right choice
20:02 considering what their time horizon and end goal is.
20:06 - Amarna, I'll suggest some changes in this portfolio
20:09 because here the investor horizon is 10 years
20:12 and he has two hybrid funds.
20:15 One is still a Balance Advantage Fund
20:18 but another one is Conservative Hybrid.
20:20 In Conservative Hybrid,
20:22 equity allocation can be 10% to 25%.
20:25 And when we talk about 10 years long investment horizon,
20:29 my suggestion would be he should consider
20:32 a diversified equity fund.
20:33 So the change I suggest here is
20:36 from HDFC Balance Advantage Fund,
20:38 he can cancel that SIP and divert that amount
20:41 to HDFC Multi-Cap Fund, which is already in the portfolio.
20:45 So one fund he can stop.
20:49 And second thing, he can replace
20:51 Pragparik Conservative Hybrid Fund
20:54 with Pragparik SIP Cap Fund.
20:56 So instead of four funds,
20:58 he will have three funds in the portfolio
21:00 and it will be a well diversified equity portfolio,
21:04 which will be more suitable for long-term title.
21:07 - Santosh, what would be your advice for this specific goal?
21:12 - So I think to begin with,
21:15 it's good that you've got a structure in place.
21:18 You've got the amount that you can,
21:19 you know the goal of 75,000
21:21 and you know the goal is very specific to kids' education.
21:24 So a couple of things.
21:25 Number one, though it is a conservative portfolio,
21:28 it's still got a fair mix of products.
21:31 Now this, number one, continue the SIP.
21:35 Be disciplined to continue and even more disciplined
21:38 not to stop, not to withdraw.
21:40 Because the secret is in continuing
21:42 and letting the money grow.
21:44 The second thing is,
21:45 I advise this gentleman is that even with an exit,
21:50 even if you can't increase it,
21:52 whenever you have excess funds,
21:53 keep topping up this investment
21:55 till your goal is achieved.
21:57 Now remember, we have a goal and we have an SIP amount
22:00 and it's a conservative mix of funds.
22:01 You may have to once in a way,
22:03 you know, add or cut a lump sum basis,
22:05 add to this so that you can achieve your goal
22:07 a little early,
22:09 considering that you've got a very conservative mix of funds.
22:13 - All right, do not withdraw prematurely
22:15 because you have a conservative mix of funds,
22:17 which is why it's considering
22:19 you don't want to risk too much.
22:21 The goal is very important.
22:23 But then don't make the mistake of withdrawing early.
22:25 Thank you so much, Santosh and Pankaj,
22:27 for joining us on the show today
22:29 and giving us all of these interesting ideas.
22:31 If you want to write into us and get advice of our experts,
22:35 do look at the numbers on your screen.
22:37 You can send us a WhatsApp message there
22:39 and we'll follow up with you.
22:41 For now, that's all the time we have
22:42 on The Mutual Fund Show,
22:43 but we're back here again, same time, same place.
22:46 See you then.
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