Will large cap mutual funds struggle to beat Nifty 100 Equal Weight Index?

Using the August 2018 Equity Mutual Fund Performance Screener published yesterday, we find out how large-cap and value-oriented mutual funds have fared against the Nifty 100 Equal Weight Index. This index has equal exposure to the top 100 stocks by free-float market capitalization. Sundaram and Principal AMC have index funds based on this. So like the Nifty…

Continue reading →

Judging fund managers by whether they invest their own money or not is wrong!

Skin in the game refers to a situation where the major decision makers (in any field) have a personal stake in the decisions that they make. In finance, one example is a fund manager and/or fund management (the fund house) investing their own money in the funds that they manage. I argue that demanding such a…

Continue reading →

When market is at an all-time high, how should a lump sum be invested? One-shot or gradually?

A few days ago, I had presented backtest results for investing a lump sum in one-shot into an equity mutual fund vs gradually. I had shown that those looking to reduce investment risk or looking for better returns via gradual investing will be disappointed as there was no clear trend as to which is better….

Continue reading →

How ETFs are different from Mutual Funds: A Beginner’s Guide

Let us consider the basic differences between Exchange Traded Funds (ETFs) and mutual funds and when should one use either product.  A couple of announcements first: (A) I will be speaking on “index investing and market timing” this Sunday, 17th June in the Tamilnadu Investors’ Association monthly meeting (see invite below). Do join if possible. (B) If you are…

Continue reading →

How to Quickly Decide: Should I stay invested or exit my mutual fund?

Resolve is a series of steps on investing and portfolio management.  In the first step, we considered how to quickly select equity mutual funds and build a diversified (equity) portfolio. As a second step, we will consider how to quickly decide if I should stay invested in a mutual fund or exit it. To be frank, the…

Continue reading →

Mutual Fund Mergers: how to track investments, calculate returns and pay capital gains tax post-merger

After the SEBI mutual fund categorization rules came into force, fund houses were forced to merge many schemes. In this post, I discuss common investor questions and problems regarding the merger – should I pay tax? how do I track? how do I calculate returns and capital gains on exit? – and so on with…

Continue reading →