Should I rebalance my mutual fund portfolio?

I am investing Rs 16,000 through SIP in the following schemes:

PGIM India Midcap Fund: Rs 2,500
Parag Parikh Flexi Cap Fund: Rs 2,500
Miare Asset Bluechip Fund: Rs 3,000
Canara Robeco Bluechip Fund: Rs 2,500
Axis Small Cap Fund: Rs 2,500
Axis Bluechip Fund: Rs 3,000

Midcap Fund – Stopped
Kotak Flexicap Fund – Stopped
Absl Focused Fund – Stopped
Canara Robeco Emerging Equity Fund – stopped

Does my portfolio look good or do I need to rebalance it? I want to invest for 15 years. I have a moderate to aggressive risk appetite.
–Kasi Raman

First, take an online quiz to sharply define your risk profile. Moderate to aggressive would mean something to you and something else to another person. Finding out your risk profile will help you on this. You can also fix what percentage of your investments you want to put in risky options like mid and small cap schemes.

You are investing Rs 8,500 in three large cap schemes. This is not needed. You just need to invest in one scheme. Investing small amounts in several schemes will not offer you meaningful diversification. It often dilutes your overall returns. You are investing Rs 5,000 in risky mid and small cap schemes. You should ensure that you are okay with exposing 1/3rd of your investments to higher risk. You should also be ready to face a lot of volatility and suffer short term losses. You should also continue with your investments irrespective of the short term losses to maximize your returns. These things are easier said than done. That’s why new investors are typically asked to avoid too much risk and stick to safer investments. For example, a conservative equity investors are asked to invest in large cap schemes. A moderate investor may invest in flexi cap schemes.

Best large cap schemes

Best flexi cap schemes

If you are new to mutual funds and don’t understand much about them, seek the help of a reliable mutual fund advisor locally. Gain knowledge and experience before investing on your own. Don’t expose yourself to unwanted risk and waste precious time that can help to create wealth.


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