Should I stay invested in credit risk funds?

'For your retirement portfolio, based on figures given and assuming a return expectation of 10%, you need further investment of around ₹20,000 to retire by the age of 53.'

By Tarun Birani

I am 33-year old and married. I have two kids, aged 3 and 1. For the last 5 years, I have been investing ₹30,000 per month in several mutual fund schemes to meet my long-term goals. For my retirement portfolio (future amount: ₹3 crore; goal is 20 years away; current accumulated corpus ₹7.97L), I have done SIP of ₹2,000 with ICICI Prudential Long-Term Equity Fund, and of ₹5,000 each in ICICI Prudential Focused Bluechip and ICICI Pru Value Discovery. For education of the first child (future value ₹50L; goal is 15 years away; ₹7.20L accumulated), I have SIPs with HDFC Mid-Cap Opportunities (₹6,000) and HDFC Top 100 (₹2,000). For education of second child, (₹50L goal that is 18 years away; current corpus ₹3.01L), I have SIPs with SBI BlueChip Fund (₹2,000), Motilal Oswal Multicap 35 (₹4,000) and Reliance Small Cap (₹4,000). Please let me know whether I have selected good funds and my allocation is correct.

Let us first see whether you can achieve all your goals in the given time frame.
  • 9.11%Annualized Return for 3 year
  • >5 years Suggested Investment Horizon
  • 6.9 YearsTime taken to double money
For your retirement portfolio, based on figures given and assuming a return expectation of 10%, you need further investment of around ₹20,000 to retire by the age of 53.

For both of your children’s education, basis the figures provided and assuming a return expectation of 10%, you will achieve your goals in the given time frame.

Portfolio Review:
I see few of your funds are underperforming in short term such as HDFC Top 100 and Motilal Oswal Multicap 35, but I recommend you hold both the funds. In the case of ICICI Value Discovery, I would like to tell you that value investing has a down cycle every few years, but this time the cycle has been longer than before. If you don’t want to take this risk, then I would recommend to stop SIP, but do not redeem the corpus. You can start a new SIP in PPFAS Long Term Equity, a multicap fund.

I would recommend you to continue with all your funds. I don’t see the need for anything to be changed here.

I have started investments in SBI, Kotak and ICICI credit risk funds. I have invested in ICICI All Seasons Bond Fund. Should I replace the investments with other funds or stay invested?

Credit risk funds are one of the riskiest funds in the debt category. You should invest only if you understand the risk, but since above are diversified and many issuers are part of portfolio, you can stay invested.

Please send your queries on Stocks to; Mutual Funds to; Tax to; Insurance to; Realty to

(The author is the founder & CEO TBNG Capital Advisors.)
(Disclaimer: The opinions expressed in this column are that of the writer. The facts and opinions expressed here do not reflect the views of
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