Arun Misra, Varanasi
How does one save capital gains against
sale of residential property?
There are two ways to do this. One can buy another
residential property at least to the extent of capital gains,
or invest to the extent of capital gains in capital gains
bond (subject to a maximum amount of `50 lakh).
Suresh Sadagopan
Founder, Ladder7 Financial Advisories
Narayana Boorgula, Karimnagar
What is a hedge fund? How can I invest in it?
A hedge fund is a pool of money just like mutual
funds, but uses alternate investment approaches
to manage the investment risks against market
volatility. In India, these funds are classified under
AIF (Alternative Investments Funds) category III,
and a minimum `1 crore investment is required.
Derivatives strategies are extensively used in their
portfolios and both long and short positions are taken
in stocks, bonds, currencies and commodities, as per
the objectives laid down in a specific fund. Players like
Edelweiss, Avendus Capital and Motilal Oswal have
such funds in their portfolio.
Manikaran Singal
Founder, Good Moneying Financial Solutions
Vinod Mehra, New Delhi
I have been investing in mutual funds (regular plan) for the past five years through
SIPs. Most of my funds are not performing well and a few of them are sectoral
funds. I’ve decided to restructure my porfolio. I plan to buy direct funds for the
long-term (15-20 years) with a moderate risk appetite and select a few funds from
my existing portfolio. The selected funds are: Kotak Select Focus Fund Direct Plan
(`2,000), Reliance Small Cap Fund Direct Growth (`2,000), Motilal Oswal Most
Focused Multicap 35 Direct Fund (`2,000), Mirae Asset Emerging Bluechip Direct
Fund (`2,000), Principal Emerging Bluechip Direct Fund (`2,000), HDFC Balance
Direct Fund (`2,000), Birla Tax 96 - Relief Direct Growth (`2,000). Please let me
know if any modification is required.
Two things I could not understand from your query. What was there in your previous
portfolio which made you believe that they were not performing well? Second, what does
moderate risk appetite mean to you?
If good performance in a mutual fund means better than others, then you can never
make a good portfolio. Star performers keep changing, but your portfolio should not
change that quickly. Be it direct fund or regular fund, the first thing you need to understand
is that you should always start with a goal in mind. What is the 15-20 years time horizon
for? Is it because you have some goal around that time or is it because this time-frame is
normal to be called long-term. Is this plan for 15 or 20 years?
I do not see any debt fund in your
moderately designed portfolio. It has a
mix of large-cap, small-cap, mid-cap,
multi-cap, balanced and ELSS funds.
Covering all the fund categories does not
mean that the portfolio is well-diversified.
What matters is what is in the funds.
More importantly, they should suit your
clearly defined and understandable risk
profile. The funds that you’ve shared are
all good in themselves. But whether they
will suit your requirements is something
that is difficult to comment on.
Manikaran Singal
Good Moneying Financial Solutions
www.outlookmoney.com May 2018 Outlook Money
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