Ask our experts – April 2023

Investment queries

I started investing in two SIPs last year. They are an SIP of Rs. 2000 in Axis Small Cap Direct Growth and Rs. 1000 per in SBI Focused Equity Fund Direct Growth. I have also started an SIP of Rs. 2000 in Mirae Asset Large Cap Direct Growth. My investment goal is to get attractive, inflation beating returns within a period of 10 years. I want to invest an additional amount of Rs 2000 per month.

Which is preferable: starting a Midcap SIP or adding to the existing SIPs? Please advise.

 Sanjay P, Ernakulam

While one cannot predict future returns, historic data suggests midcaps have the potential to outperform in the long term. You may consider investing in a midcap fund and we believe you are aware of the universe they invest in. Below are some Midcap schemes we recommend.

CategoryScheme NameSIP CAGR %
3 Yr5 yrs.10 yr.
MidcapPGIM India Midcap Opp Fund24.7524.02
MidcapSBI Magnum Midcap Fund23.9720.1716.47
MidcapKotak Emerging Equity Fund22.4119.5518.36
SIP CAGR as of 16-Feb-23

I want to invest for the next 10 to 15 years. Which is better flexi cap or focus fund? Do you have any recommendations for the top funds in this category?

– Vinay S, Kalpetta

Flexi cap and focused funds have a few differences as well as similarities. By regulation, Flexi cap and Focused funds invest majority portion of their corpus into equity and related instruments. Both can have a dynamic approach towards Large, Mid and Small cap stocks.

The difference is that a Focused fund can invest in a maximum of 30 stocks. Therefore, Focused funds are concentrated while Flexi cap has a more diverse portfolio overall. Focused funds generally are considered to have relatively higher risk as compared to Flexicap funds. As a result, the expected returns are also on the higher side. Your decision should be based on knowledge and risk-tolerance.

The following lists our top recommendations for both groups. (With their SIP returns).

CategoryScheme NameSIP CAGR %
3 Yr5 yrs.10 yr.
FlexicapPGIM India Flexi Cap Fund-Reg(G)16.0216.96
FlexicapFranklin India Flexi Cap Fund(G)2016.0413.83
FlexicapUnion Flexi Cap Fund-Reg(G)15.8415.0212.3
     
FocusedIIFL Focused Equity Fund18.4418.49
FocusedNippon India Focused Equity Fund19.7416.315.38
FocusedSBI Focused Equity Fund10.7711.9513.8
SIP CAGR as of 16-Feb-23

0 Shares:
Leave a Reply

Your email address will not be published. Required fields are marked *

You May Also Like
Plan for retirement
Read More

Planning whiz – January 2023

Geojit’s Investment Analyst, Gibin John, helps a couple with their financial planning. They want him to assist them in meeting their financial objectives, such as saving for their child's education, purchasing a car, and retirement on time. Gibin John analyses their current investments and helps them plan to achieve their goals.