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Need your help in my mutual fund portfolio

Please find my current portfolio and guide me for following mentioned points - ICICI Focused Blue Chip - Equity (SIP) - 1000, Reliance Small Cap Fund (SIP) - 2500, Reliance Money Manager Fund (SIP) - 10000, ICICI Top 100 - Regular Growth (SIP) - 2500, HDFC Mid Cap Opportunity Fund - Growth (SIP) - 2500, MFGP UTI MNC Fund - Growth (SIP) - 5000. 1. Need advice to invest INR 15,000 more in SIP? 2. Please advice about tax deduction while withdrawing the money from above mentioned funds? 3. I want to invest 15 lack in MF and need some monthly amount benefit to pay my Home loan EMI? 4. I want to deposit the INR 15 lakh from my NRE account (yes bank). Tell me the income tax issues?

Apr 4, 2017 by Pushpendra Mahara,   |   Mutual Fund

1. You have chosen funds from large cap, mid & small cap, thematic and liquid funds. The fund selection is okay excepting UTI MNC fund which is a thematic fund and may require a very long term horizon of investing. In the last one year the fund could not beat the benchmark NIFTY MNC. Also, the thematic funds are suitable only for very high risk profile investors and you may have to wait for a long time for the MNC theme to pay.

If your risk taking appetite is very high and also the investment horizon long, you may hold the fund else you can switch to UTI Equity Fund which is a large cap fund.

2. For doing Rs 15,000 more SIPs, you may add a part of it in the schemes in your existing portfolio – ICICI Prudential Focused Bluechip Equity Fund, HDFC Midcap Opportunities Fund and Reliance Small Cap Fund. If you want to add couple of more schemes then you may select SBI Bluechip Fund, a large cap fund and Mirae Asset Emerging Bluechip Equity Fund, a midcap fund.

3. Long term capital gains is tax free in case of equity funds. That means if you are withdrawing after 12 months there will be no capital gains taxes. However, in case of Reliance Money Manager fund, if you withdraw before 3 years, short term capital gains tax will be applicable. In case you withdraw after 3 years. Long term capital gains tax @20% will apply after allowing indexation.

4. If you want to draw a monthly amount from your mutual fund investments, then you can invest in balanced funds and withdraw through SWP route – a fixed amount on a fixed date – every month. However, if you keep the total annual withdrawal amount upto 8-9% of the initial corpus then it would be better. Otherwise, you can invest in balanced funds which pays monthly dividends. You can check this link https://www.advisorkhoj.com/mutual-funds... and may consider investing in ICICI Prudential Balanced Fund, HDFC Prudence Fund, DSP BlackRock Balanced Fund etc. as these funds pay monthly dividends

5. To Check SWP return of Balanced Funds, do check this two links https://www.advisorkhoj.com/mutual-funds... and https://www.advisorkhoj.com/mutual-funds...

6. The investment from NRE account is very common. The funds you invest from NRE account is repatriable. The taxation of mutual fund in case of Resident and NRI investors is also same excepting that there will be TDS in case of short term capital gains, in case of NRIs. In case of resident individuals, there is no TDS. However dividend received in NRE account and the long term capital gains in case of equity or equity oriented funds (like balanced funds or Arbitrage Funds) is totally tax free.

Hope the above helps! Thanks for writing to Advisorkhoj.

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