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Can I expect 14 to 15 percent return from my mutual fund investments

I am a 40 year old individual I am investing INR 76,500 every month in SIP's in the below fund. My investment horizon is 5-10 years and am looking at generating a CAGR of around 14-15%. Does the fund selection look right? Request your suggestions scheme name SIP amount Mirae Asset India Opportunities Fund - Regular Growth Plan 10000, HDFC Balanced Fund - Regular Plan - Growth 10000, L&T Midcap Fund - Growth 7500, Mirae Asset Emerging Bluechip Fund - Regular Plan Growth Option 9000, Motilal Oswal Most Focused Multicap 35 Fund Regular Growth 10000, Tata Equity P/E Fund Regular Plan - Growth 10000, Sundaram Rural India Fund - Regular Plan - Growth 10000, DSP BlackRock Micro Cap Fund - Regular Plan - Growth 10000. Further I have some corpus which I intend to invest in a Debt Fund/MIP which will generate around 12% CAGR post tax for the next 5-7 years. I will be funneling these returns in the above/similar funds after the 3 year period to take benefit of LTCG tax?

Jun 7, 2017 by Sameer, Mumbai  |   Mutual Fund

Your fund selection for SIPs are good excepting TATA Equity PE Fund. You have selected mostly mid cap funds and there is one from balanced and two from diversified equity fund category. Therefore, overall the portfolio is quite aggressive. In place of TATA Equity PE fund, you can select a diversified or large cap fund. SBI Bluechip Fund or Birla Sun Life Equity Funds could be good choices.

With regards to your return expectations, please note that historically, good equity funds have delivered return in the range of 14-15% and therefore you can expect that. Having said that, it would be better to plan your goals (which you are trying to achieve through these investments) with an expectation of 12% only. It is better to be conservative as you never know how the market returns will unfold in future.

Your idea of investing in debt fund and MIP is good. However, expecting 12% from debt fund is very high. You can select good performing debt funds and MIPs from our research section - please check this link - Top Consistent Mutual Fund Performers.

Hope the above answers your query well. Thanks for writing to Advisorkhoj!

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