I have been investing ₹2,000 each through SIPs in Axis Bluechip, ICICI Prudential Equity&Debt, and Parag Parikh Flexi Cap (till inflows were stopped), and a lump sum of ₹50,000 in Mirae Asset Large Cap. Since Parag Parikh Flexi Cap has stopped taking fresh inflows, kindly suggest alternatives to deploy the cash. I also have an additional ₹2,000 to invest. My funds’ suggestion list includes Canara Robeco Flexi Cap, Edelweiss Balanced Advantage, and UTI Nifty Index. I am a moderate risk-taker. Can I go ahead with any of these funds or others that may be better?
— Kumaran R.
Parag Parikh Asset Management Company has started accepting new lump sum and SIPs in Parag Parikh Flexi Cap Fund from 15 March. If you had set the SIP before 1 February, your SIP would have continued to remain active.
While all the funds that you are investing in are good, some understanding of your investment horizon would have been helpful. If your idea behind investing in the ICICI Prudential Equity&Debt fund was to take a moderate risk, I would like to highlight that this fund is an aggressive hybrid fund where equity allocation would be around 70-75%. In such a case, the risk on this fund will continue to remain high.
You can consider investing the additional SIP in UTI Flexi Cap or Canara Robeco Emerging Equities fund, if you would like to go ahead with equity-oriented funds. Else, Edelweiss Balanced Advantage fund is also a good option in case you want to reduce the overall risk of your investment.
The returns from hybrid funds could be lesser than equity funds in the long run as they have some allocation to debt.
Harshad Chetanwala is co-Founder at MyWealthGrowth.