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Should I continue SIP in HDFC Top 200, UTI opportunities and Quantum Long Term Equity

I am doing SIP in UTI Opportunity Fund, HDFC Top 200 Fund and Quantum Long Term Equity Fund for the last 2 years. Once these funds were very good funds but for in last few years there returns have dipped. What should I do?

Dec 30, 2015 by Sundeep, Haridwar  |   Mutual Fund

UTI Opportunities and HDFC Top 200 Funds are both large cap funds with good long term track records. Over the last one year, they have given negative returns. But the large cap index itself, including both our leading frontline stock indices, Sensex and Nifty, have given negative returns in the last one year. Quantum long term equity fund, a diversified flexicap fund, on the other hand, has given positive returns in the last one year. It is not fair to evaluate the performance of a fund in extremely volatile market conditions, like what we have seen in the last one year. You should note that the Sensex and Nifty ended lower in 2015 year on year (YOY) compared to 2014, for the first time since 2011. Usually, if you look at history, the market, especially large cap stocks, always rebounded strongly after a year of sharp corrections. Many market experts believe that, 2016 will be a much stronger year for the large cap segment, though most of the recovery may be back-ended in 2016. The macros of the Indian economy is very promising and we will continue to benefit from lower commodity prices, even in 2016. In fact, going by the views of some fund managers of leading AMCs, the benefit of lower crude prices will be higher in 2016, even if it were to rise by a little bit. The Modi Government is still committed to the reforms agenda. As such, we should not be too worried about our FY 2016 GDP being revised downwards. India is still the bright spot in global emerging economies, as a number of economic reports have elucidated. So hopefully, your portfolio should do much better in FY 2017. In that case, the units bought with your SIPs at low NAVs will be a blessing in disguise for you. Having said that, if the economy recovers 12 months from now and your portfolio schemes are still not doing that well, it would call for a revision of your fund selection. So you should continue to monitor the performance of your funds and take an appropriate decision accordingly, in consultation with your financial advisor.

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