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I have saved ₹12 lakh from my salary. The funds are in a savings bank account. Due to extreme volatility in markets, I have not invested this sum. Markets are at all-time highs. These funds are needed only in 2028 and 2030. Can I request your guidance on how and where to deploy this lump-sum amount? I am not concerned about volatility, since its normal in equity/MF investment. My concern is entry time and fear of buying at high prices, which may impact the returns.
Balaji, Bengaluru
Though holding funds in a savings bank account preserves your capital, it does very little in terms of making your money grow. Today, a savings account with SBI, for instance, fetches 2.7 per cent interest for any amount above ₹1 lakh. Yes, private banks such as Kotak Mahindra Bank offer a higher 4 per cent on savings accounts with a balance of over ₹1 lakh. But even this is not surely tempting enough to leave funds idling in bank accounts as the returns may not match inflation.
Fund Query: Factor in inflation while setting financial goals
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I am 39 years old and a doctor by profession. I started investing in mutual funds and bluechip stocks from January 2021. I have invested ₹5,500 in DSP Midcap, ₹5,000 each in Axis Bluechip, Parag Parikh Flexi Cap and Axis Mid Cap, ₹500 in Axis Long Term Equity, and ₹1,000 in SBI Equity Hybrid. I have an SIP of ₹2,000 a month in SBI Small Cap. Thanks to
BusinessLine Portfolio Star Track MF Ratings for helping me choose. I plan to withdraw from DSP Midcap and SBI Equity Hybrid if the ratings drop further. How can I calculate how much to invest per month? Here are my goals: retire by 65: ₹1 crore; education of two kids, 18 years from now: ₹2 crore; and their weddings, 25 years from now: ₹1 crore. I would appreciate if you can tell me how to set goals, because what I have set is very arbitrary.
Maulik Madhu
BL Research Bureau |
Updated on
February 06, 2021
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The fund has outperformed most of its peers over 3- and 5-year periods on rolling-return basis
Hybrid mutual fund schemes invest in a mix of equity and debt. Within this category, funds that invest their corpus aggressively in equity 65-80 per cent in equity and the rest 20-35 per cent in debt are categorised as aggressive hybrid funds
Among the top performers in the category is SBI Equity Hybrid Fund, a scheme that you can consider investing in. It is rated five-star in
BusinessLine Portfolio Star Track MF Ratings.
SBI Equity Hybrid (earlier called SBI Magnum Balanced), the largest in the category, has outperformed many of its peers. A significant presence of large-caps (along with mid-caps, to an extent) in its equity portfolio, coupled with a large proportion of high-rated papers in its debt portfolio, make it a good bet in this space.
Fund query: Start investing with the start of your professional career
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I am about to start my professional career around June 2021. I want to know the kind of mutual funds I should look for as part of my core as well as satellite portfolio, given that I am a risk-averse person. Also, I understand the importance of fixed- income debt instruments, but I want good inflation-beating returns. When evaluating a fund, what are the key factors I should look into?
Ansh Sarwal
Congrats on your plan to start investing along with the start of your professional career. You could reap rich rewards by staying invested over the years. Also, the mutual fund route to investing is a good one, especially in equities. Equity mutual funds, run by professional fund managers, invest in a basket of stocks, reducing risk.