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Mutual Fund Guide!

Mutual Fund Guide!

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Kuldeep Singh
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© © All Rights Reserved
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Download as PDF, TXT or read online on Scribd
34 views

Mutual Fund Guide!

Mutual Fund Guide!

Uploaded by

Kuldeep Singh
Copyright
© © All Rights Reserved
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 13

01

2993
that’s the number of mutual funds
in India as of June 2024.

Choosing the right mutual fund


can be a challenging task, but

let me make it easier for you


with my checklist.
02 THE VALUATION SCHOOL | PARTH VERMA

Before we start, lets understand

what are mutual funds?


A mutual fund pools money
from many investors to invest in
diversified portfolio of different
asset class.

A more important question is,


Why should you invest in
mutual funds?
03

Diversification
It spreads yours risk by investing
in variety of assets.

Professional Management
Experts manage your investment
for you.

Liquidity
Offer high liquidity, allowing investors
to buy and sell units easily.

Cost-Effective
You can start investing with as
little as ₹100.
04 THE VALUATION SCHOOL | PARTH VERMA

Check No. 1

Background of
Mutual Fund House
Check if there is any Bad news
or Negative review about mutual fund
house, like regulatory actions, poor
management or Underperformance.

This can act as potential red flag


for our investment decision.
05

Check No. 2

Fund History
Look for a fund that has experienced
both bull and bear markets.

and evaluate 10 & 5-year CAGR


of the fund, rather than just
focusing on short-term returns.

Compate Funds on Rupeevest (MF Screener)


Credits: Rupeevest.com
06 THE VALUATION SCHOOL | PARTH VERMA

Check No. 3

Experience of
Fund Manager
A fund manager's experience is very
important for a fund's performance.

An experienced manager with many


years in the field is more likely to
handle volatility better.

Check how long they have been


managing the particular fund and examine
the fund's returns during their tenure.
07

Check No. 4

Expense Ratio
Expense ratio is the fee you pay to
experts for managing your fund.

It is an essential factor to evaluate,


as it can significantly impact your
long-term returns.

For instance:
08 THE VALUATION SCHOOL | PARTH VERMA

Check No. 5

Portfolio Diversification
Check the number of stocks the
mutual fund has invested in.

A higher number of stocks signifies


a more diversified portfolio,
which means lower risk.

You can find the number of stocks in the


mutual fund's factsheet.

But too many stocks can also lead to


Diworsification, so have a through look!
09

Check No. 6

Turnover Ratio
Turnover ratio measures how
frequently assets within the fund
are bought and sold by the
managers.

For Example:

A turnover ratio of 40% means that the fund


manager has sold 4 out of every 10 stocks in the
portfolio and replaced them with new stocks over
the course of one year.
10

A high turnover ratio indicates


that the fund manager is actively
buying and selling securities within
the fund.

In contrast, a low turnover ratio


suggests that the fund manager
is holding onto securities for a
longer period.
11 THE VALUATION SCHOOL | PARTH VERMA

If you want to learn how


to select a fund that suits you

check out our YouTube


Playlist on Mutual Fund
analysis!

Link in the
Comments!
THE VALUATION SCHOOL | PARTH VERMA

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