1. Any redemption should depend on compelling reasons like:-
a) Fund is continuously underperforming its peers, with rating downgrades during the year,
b) Fund is irrelevant now as your goals have changed, and
c) You're "weeding" it out to rebalance your portfolio within existing corpus.
2. If so, you can redeem, otherwise it would be better to start a SIP in a 4/5 star Multicap fund for diversification in your portfolio.
3. If redeeming, a lumpsum action may work if CG taxes are insignificant or can be digested.
4. Otherwise STP from existing to target fund, or SWP (with simultaneous SIP in target multicap fund) suits better for:-
a) Availing CG tax benefits,
b) Avoiding "timing" market,
c) Cost averaging target fund, and
d) Having scope to salvage some loss being incurred in existing fund.
a) Fund is continuously underperforming its peers, with rating downgrades during the year,
b) Fund is irrelevant now as your goals have changed, and
c) You're "weeding" it out to rebalance your portfolio within existing corpus.
2. If so, you can redeem, otherwise it would be better to start a SIP in a 4/5 star Multicap fund for diversification in your portfolio.
3. If redeeming, a lumpsum action may work if CG taxes are insignificant or can be digested.
4. Otherwise STP from existing to target fund, or SWP (with simultaneous SIP in target multicap fund) suits better for:-
a) Availing CG tax benefits,
b) Avoiding "timing" market,
c) Cost averaging target fund, and
d) Having scope to salvage some loss being incurred in existing fund.