Gold as an investment

Where should I invest bonus of Rs 50 lakh; should I invest lump-sum or through SIPs?

I am 30. I received an annual bonus of Rs 50 lakh and want advice on how to invest it. I have monthly SIPs of Rs 75,000 equally distributed across debt, liquid and equity fund categories with a total mutual fund corpus of about Rs 14 lakh. I am invested in SBI Banking and PSU Fund, SBI Bluechip, ICICI Prudential Balanced, HDFC Hybrid Equity, HDFC Index, HDFC Index Nifty 50, HDFC Low Duration, Parag Parikh Flexi Cap, Tata Liquid, ABSL Liquid, DSP Equal Nifty 50, IDFC BPDF, Axis Focused 25, Axis Long Term Equity, Axis Bluechip, Mirae Asset Emerging Bluechip, Quant liquid, PGIM India Global Equity Opportunity and PGIM India Ultra Short Term. Should I pick a few funds from these existing SIPs and invest the lump sum?

Sanjiv Bajaj Joint Chaiman MD-Bajaj Capital replies: You have not mentioned the risk appetite, investment objective and horizon. We assume your risk appetite is moderate to aggressive and the goal is wealth creation. We suggest you invest Rs 40- 45 lakh in dynamic asset allocation/balanced advantage funds. This will allow significant participation in upside of equities while limiting volatility, offering superior risk adjusted return compared to pure equity funds. You can divide the corpus among ICICI Pru Asset Allocator, Nippon India Balanced Advantage and Kotak Balanced Advantage Fund. Keep Rs 5-10 lakh in liquid funds for emergencies. As far as your existing investment is concerned, it is distributed among debt, hybrid and equity segments. If your horizon is long and the goal is wealth creation, shift your entire SIP amount into equity-oriented schemes as equity has the potential to deliver superior returns in the long run. The Rs 75,000 can be equally divided among Axis Growth Opportunity, Mirae Asset Emerging Bluechip, Nippon India Multi Cap, Parag Parikh Flexi Cap, UTI Flexi Cap, Kotak Emerging Equity and IDFC Sterling Value Fund. Review your portfolio at least once a year.

I am 25 and earn Rs 10,000. Since May 2021, I have been investing Rs 2,000 in SBI Focused Equity, Rs 2,500 in Axis Bluechip, Rs 1,000 in UTI Nifty Index, and Rs 1,000 in Parag Parekh Flexi Cap Fund through SIPs. I need to save Rs 2 lakh by the end of 2022. Should I invest in stocks, crypto or any other options?

Dev Ashish Founder, StableInvestor and Sebi-registered investment advisor replies: First make sure you have purchased adequate life insurance (plain term plans only) and health insurance. Also, it’s advisable to set aside an emergency fund that can take care of a few months’ expenses. With regards to your SIP portfolio totaling Rs 6,500 per month, you don’t need four funds. Just pick two from amongst them —one index fund (UTI Nifty Index) and one flexicap fund (Parag Parekh Flexi Cap or SBI Focused Equity Fund) and split the SIPs between them. As these are equity funds, you should be willing to remain invested for 5-7 years. Your target is to have Rs 2 lakh by the end of 2022. For such near-term goals, debt is the suggested option. One needs to invest Rs 15,000-16,000 per month to accumulate Rs 2 lakh in a year’s time. If you can arrange the required surplus, then use simple bank RD or ultra-short duration debt funds to accumulate the funds. Stocks are not suitable for such shortterm investing and crypto investing is highly risky. So, it’s a no for both.

I am 50 and investing in mutual funds for the past 3-4 years. About 80% of my investments are in debt funds and rest in equity funds. I have some investment in gold (SGF) and FDs. I read there is a market correction expected and we should reduce equity exposure. However, the return from debt funds over the past nine months has been very low (2%). I don’t need any big amount in the next five years. Of my total savings, 50% is in MFs and the rest is in FDs, gold, real estate. How should I structure my MF portfolio? Should I take out the money from MF and keep it in bank FDs for next one year?

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Rushabh Desai Founder, Rupee With Rushabh Investment Services replies: It is very difficult to predict market corrections. Looking at the current situation, there can be volatility and corrections, especially if companies don’t maintain strong growth and earnings. In many cases valuations still look a bit stretched so it is better to be cautious. Since you have a good exposure to debt mutual funds, gold, real estate and FDs and with only 20% allocation towards equities I don’t think you should reduce this part of your portfolio. However, given your age I would not recommend more than 50% allocation towards equities. Apart from liquid and ultra-short duration funds, keep the maturity profile of your other funds to a maximum of 4-5 years to avoid mark to market volatility. I don’t recommend dynamic bond funds and you can look at investing in the floating rate category. Since you already have exposure in FDs and all your cash flow requirements are fulfilled through them, you can let your equity and debt mutual funds and gold portfolio be the way they are and let them grow over the long term. During decent correction pockets you can think of increasing your equity exposure. You can also look at introducing balanced advantage / dynamic asset allocation funds in your equity portfolio as these funds do not require you to time normal market corrections. Lastly don’t go overboard in investing in gold and real estate.

(Disclaimer: The opinions expressed in this column are that of the writer. The facts and opinions expressed here do not reflect the views of

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