Model Portfolios based on Risk Appetite and Time Horizon

[Pages:19]Model Portfolios based on Risk Appetite and Time Horizon

An Investor Education and Awareness Initiative by Franklin Templeton Mutual Fund

For Internal Use Only / Not for Distribution to the Public

Process of Building a Mutual Fund Portfolio

? Process of Elimination

? Define Your Filtration Criteria ? Refrain from Investing in Schemes Not Suitable for You ? Limit the Number of Funds in Your Portfolio ? Avoid Duplication ? Eliminate Inconsistent Performers

? Process of Selection

? Select Across Market Caps ? Select Across Investment Style ? Select Across Asset Class

For Internal Use Only / Not for Distribution to the Public

Approach to Building a Mutual Fund Portfolio

? Building Portfolio based on Risk Appetite

? Aggressive Risk Appetite ? Moderate Risk Appetite ? Conservative Risk Appetite

For Internal Use Only / Not for Distribution to the Public

Approach to Building a Mutual Fund Portfolio (Contd.)

% of portfolio based on Risk Appetite

Market Cap / Style

Aggressive

Moderate

Large-cap Funds

20%

30%

Mid-cap Funds

30%

10%

Multi-cap Funds

10%

20%

Flexi-caps / Opportunities

30%

20%

Balanced Funds

-

20%

Sector / Thematic Funds

10%

-

Portfolio Total

100%

100%

The above table is indicative and for illustration purpose only Source: PersonalFN Research

Conservative 40% 20% 40% -

100%

For Internal Use Only / Not for Distribution to the Public

Approach to Building a Mutual Fund Portfolio (Contd.)

? Building Portfolio based on Strategy

? Core Holdings ? Satellite Holdings

For Internal Use Only / Not for Distribution to the Public

Approach to Building a Mutual Fund Portfolio (Contd.)

Market Cap / Style Core Large-cap Funds Mid-cap Funds Multi-cap Funds Balanced Funds

% of portfolio based on - Strategy - Risk wise

Aggressive

Moderate

50%

60%

20%

30%

20%

-

10%

20%

-

10%

Satellite Mid-cap Funds Multi-cap Funds Flexi-caps / Opportunities Balanced Funds Sector / Thematic Funds

50% 10%

30%

10%

40% 10%

20% 10%

-

Portfolio Total

For Internal Use Only / Not for Distribution to the Public

100%

100%

The above table is indicative and for illustration purpose only Source: PersonalFN Research

Conservative 80% 40% 10% 30%

20% -

10% -

10% -

100%

Approach to Building a Mutual Fund Portfolio (Contd.)

? Building Portfolio based on Asset Allocation

? Define a Standard Allocation Across Asset Class (i.e. Equity, Debt and Gold) ? Regularly Monitor and Keep a Proper Track of Your Allocation ? Timely Rebalance Your Asset Allocation

For Internal Use Only / Not for Distribution to the Public

Approach to Building a Mutual Fund Portfolio (Contd.)

% of portfolio based on - Asset Allocation - Risk wise

Market Cap / Style

Aggressive

Moderate

Equity

80%

60%

Large-cap Funds

20%

30%

Mid-cap Funds Multi-cap Funds

30% 10%

10% 20%

Flexi-caps / Opportunities

30%

20%

Balanced Funds Sector / Thematic Funds

10%

20% -

Debt Long Term Income Funds Short Term Income Funds Money Market / Liquid Funds

10% 40% 40% 20%

25% 30% 40% 30%

Gold ETFs / Funds

10%

15%

Portfolio Total

For Internal Use Only / Not for Distribution to the Public

100%

100%

The above table is indicative and for illustration purpose only Source: PersonalFN Research

Conservative 30% 40% 20% 40% -

50% 20% 40% 40%

20%

100%

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