Hi, I have been investing through sip since last 5 yrs. Some funds have given above 10 returns and some 7% like hdfc top 200.
My question is since I am reviewing after 5 yrs is it right for me to choose some better performing fund.
What should I do to the corpus I have accumulated in these 7% performing funds. Shall I withdraw it fully and start fresh sip. Or lumpsum investment in fund.please advice.
Satyan-First understand your % of return expectation from this equity portfolio. If it is matching, then no need to worry. When we invest 2-3 funds, then there may be a single or two funds which may not perform to it’s benchmark or peers. It does not mean that we have to switch the funds. Also, the fund invested today must not be in top forever. Considering all these factors, if you still felt some funds are worth to dispose, then go ahead. To be frank, HDFC Top 200 Fund is best fund with consistent performance. It may not be matching it’s peers but check with benchmark. Also, when I checked HDFC fund for risk-return analyzer, I found that this fund showing negative results only since a year.
When you review the fund and decided to move, then you have to switch to some good funds of same category. Switching to new fund must be withdrawing all amount from old fund and invest in new fund as lump sum and also start a new SIP.
Thanks for the well explained answer