Ask Morningstar: What you want may not be what your portfolio needs

By Kavitha Krishnan |  17-03-22 | 
 
No Image
About the Author
Kavitha Krishnan is a Senior Research Analyst on Morningstar's Fund Research team. She has over 9 years of experience in the Financial Sector. She would like to hear from you, but cannot give financial advice.

Please let me know if my portfolio is suitable for 20-25 years. Axis Growth Opportunities (Rs 5,000), Mirae Asset Tax Saver (Rs 4,000), Parag Parikh Flexicap (Rs 6,000), Mirae Asset Midcap (Rs 8,000), Canara Robeco Smallcap (Rs 4,000) and Motilal Oswal NASDAQ 100 FoF (Rs 4,000). I want to do one more SIP of Rs 4,000. Should I add Axis Flexi Cap?

On the face of it, your portfolio is well spread out across market capitalisations and appears fairly diversified. Mirae Asset Tax Saver and Parag Parikh Flexicap are run with a predominant large-cap bias. The mid-cap exposure seems well spread out with funds like Axis Growth Opportunities and Mirae Asset Midcap.

Now let’s deep dive into your portfolio.

Axis Growth Opportunities Fund is managed by Jinesh Gopani and carries an exposure towards large and mid-cap stocks with the fund carrying around 65-70 holdings. The approach is towards long term investing, with the fund carrying a low tracking error.

Mirae Asset Taxsaver is managed by Neelesh Surana and carries a Morningstar analyst rating of Silver. It has remained a consistent performer and we hold the manager in high stead.

Parag Parikh Flexicap is the AMC’s marqee fund managed by Rajeev Thakker. Though it follows a concentrated approach to investing with around 30-35 stocks, Thakker has been successfully navigating the market volatility with this fund.

Mirae Asset Midcap is managed by Ankit Jain. It’s a fairly new fund, incepted in July 2019 and does not have a previous track record. Jain is also new to fund management, although he has managed the Great Consumer Fund in the past.

Canara Robecco Smallcap is also fairly new, started in February 2019, which leaves it with a relatively short track record.

You also carry some exposure towards international equities thanks to Parag Parikh Flexicap and the NASDAQ 100 FoF.

kavita

Your monthly SIP amount in Mirae Asset Midcap and Canara Robecco Smallcap totals Rs 12,000. Your investment in other funds (excluding the FoF) is at around Rs 15,000 per month. Your investments in the small and mid-cap space likely outweigh that of large caps.

Based on this, and the overall risk that you are taking, we recommend that you bypass Axis Flexi Cap and invest in a pure large-cap fund to balance out your portfolio. You could choose from any pure play large-cap fund that suits your requirement.

Some funds that we have a high analyst rating on are HDFC top 100 and Aditya BSL Frontline Equity Fund. You can look at the views of our analysts regarding these large-cap funds:

Registered readers can post their queries by accessing the Ask Morningstar tab. Our team will answer SELECT queries ONLY relating to mutual funds and portfolio planning.

Add a Comment
Please login or register to post a comment.
ninan joseph
Mar 19 2022 10:13 PM
 Instead of a Large cap fund, why not Nifty 50 Index fund or ETF along with Nifty next 50. This will cover the entire large cap universe and since he has time factor as he is only 25, the compounding effect will truly be meaningful. By doing this he will also have a passive fund in his portfolio.
1<>
Top
Mutual Fund Tools
Ask Morningstar
Feedback