Are Parag Parikh & Axis Flexi Cap good?

I’m 26 and I’m investing ₹5,500 monthly in SIP within the following funds: Axis Flexi Cap – ₹1,500, Parag Parikh Flexi Cap – ₹1,000, Axis Bluechip- ₹1,000, Axis ESG – ₹1,000 and Nippon India Pharma Fund – ₹1,000. I’m an aggressive and high-risk investor and I’m on the lookout for an investing horizon of 10-15 years. Am I heading in the right direction or ought to I spend money on different funds?

—Name withheld on request

An all-equity portfolio reminiscent of yours is okay in case your funding time horizon is past 5-7 years. So, as you point out, if you’re investing for 10 or 15 years, such a portfolio could be wonderful. However, I see a must do some pruning in your portfolio. For one, a ₹5,500 portfolio doesn’t require 5 funds in it. Secondly, having thematic or sector-specific funds in a general-purpose long-term portfolio isn’t a good suggestion. Such funds, particularly sector funds, require a eager understanding of the particular sector to allow well timed entry and exit into the funds.

These funds assist you to do broad-based ‘plays’ on the sectors, and will not be appropriate for generic asset-class publicity {that a} long-term portfolio seeks to offer.

So, to your portfolio, I’d recommend transferring out of each such funds and rising your allocation to the Parag Parikh fund and the Bluechip fund.

In future, do you have to improve your SIP (systematic funding plan) quantity, you’d have room so as to add a mid-cap fund or two to additional diversify your holdings.

Srikanth Meenakshi is founder, Primeinvestor.in.

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