Monday, March 1, 2010

BEST FUNDS FOR A NEW INVESTOR

ALL WEATHER FUNDS



Jagdish Kumar asked :
Dear Sir,

I need suggestion for Below funds, i m planning to start sip for Rs. 8000-10000 in below 2 or 3 funds. Pls help in choosing the best performing funds in future.

Shortlisted Funds:
1) Reliance Growth Fund
2) Reliance Banking Fund
3) Pru. Icici Infra Fund
4) Icici Focused Equity Fund
5) Templeton India Enquity Fund
6) Franklin Asian Equity Fund
7) Franklin Bluechip Fund
8) DSP BR Top 100
9) HDFC Top 200
10) Reliance Vision Fund

Pls kind choose the best from these above 10, & kindly advice & help me for creating a good portfolio for Future. As i m looking at 2 yrs SIP for chosen funds once suggested from yourside.
I want the BEST fund to invest which will perform in all seasons and also tell WHEN is the Best time to invest. In short, is there any fund which any new investor can blindly invest???

Thks in advance and waiting for your comment on above investment.

Regds
JK

SRIKANTH MATRUBAI replied :

Dear JK, First of all please understand there is no such thing like THE BEST FUND TO INVEST.
One should try to invest in good funds not in the best fund of current time. Because leadership positions may be changed very quickly.

Today`s winners may become losers & today`s losers may become winners tomorrow. Fund performance keep fluctuating and other than Stock Performance, factors like change in Fund Manager too affect the performance of the Fund due to the Fund Manager`s change in strategy, etc. (Remember JM's super performance in 2007-08 and the super dud show thereafter??)
You may be surprised to know that the None of the Top 10 Funds of 2008 made it to the list in 2009!!
However, what I can suggest you is to invest in those fund which has been consistent in all Market Cycles and is more of `no surprise` fund rather than a spectacular performer in a Bull market and a Super Flop in a Bear market.



DREAM FUNDS........ THE BEST FUND FOR ALL SEASONS:
There are very very few funds which can fit into the category of a Dream Fund, the one which you can invest either in Peak of the Bull Run or the nadir of a Bear Market. Consistent above average performance across market cycles is the key here. Sure, there will be a few hiccups here and there even in the Best of Bests., buy you have to digest and let the fund perform to its maximum capability. My selection of 'All Weather Funds' are as follows:
HDFC Top 200 Fund
HDFC Prudence Fund
Reliance Growth Fund
Reliance Regular Savings Fund - equity
Sundaram Select Focus Fund
SBI Magnum Contra Fund
(inspite of frequent change in Fund Managers, the fund has managed to carry on its good works)
DSPBR Equity Fund
Fidelity Equity Fund



See these links
http://goodfundsadvisor.blogspot.com/2009/03/best-funds-for-cautious-investor.html

http://goodfundsadvisor.blogspot.com/2009/01/portfolio-advise-needed.html

http://goodfundsadvisor.blogspot.com/search/label/Star%20performers



The funds I have shortlisted do have long history of picking long term winners and have earned consistent returns over time.
The above fund shortlisted is not the 'one size fits all'., but you can make these funds as 'core' of your portfolio and add further depending on your profile.

WHEN TO INVEST :
Without going through the routine of explaining, I will be straightforward and tell you in the face…………….Anytime is the BEST time to invest.
Surprised??. Yes, even if you started invested right at the peak Sensex levels of 21000, if you have had invested through SIPs, even now, when the Sensex is down by more than 20%, still you would be in PROFIT!!!! SIP investment ensures that you 'automatically' time the market and also gives the added advantage of Rupee Cost Averging.


You can invest in any above funds depending on your risk profile and objectives. For you Rs.8000-Rs.10000 investment, from your list of funds, I suggest you to consider
HDFC Top 200 fund
Reliance Growth Fund.

Outside of your list, you may consider
fidelity Equity fund
HDFC Prudence Fund
Mirae Asset India Opportunities Fund
Sundaram Select Focus Fund.

Do go for sip and invest in different dates to take advantage of volatility.
Best of luck,
Srikanth Shankar Matrubai






Also visit

http://equityadvise.blogspot.com

1 comment:

  1. Hi Srikanth,

    i have gone through many posts in ur blog and thanks for the valuable information. I am not having much idea on mutual funds since i am a beginner (6 months of investing experience :) )..

    i find Sundaram Select Focus Fund as a fund which u have recommended to many people, but i am not able to find the reason of ur preference of Sundaram Select Focus Fund over Sundaram select midcap. both these are almost similar performers with select midcap being a better performer.

    ReplyDelete

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