Original analysis, reports, reviews and insights on developments in the mutual fund space and in-depth reviews
Question: When can you use an investment portfolio that cannot exceed an equity allocation of about 25%? Value Research classifies them as Hybrid: Debt-oriented Conservative. There are about 43 funds in this category and more than half of them contain the phrase “monthly income plans” (MIP) in their names. Some are called regular savings funds (not to…
Continue reading →After spotting mutual fund underperformers in the portfolio, what is the next step? The options may seem quite obvious and there is not much to write about. I decided to write a post about it (instead of mentioning this in the last post itself) for two reasons: Handling underperformers in the portfolios has some interesting aspects of…
Continue reading →In a two-part series, I would like to discuss how to spot (I) and how to handle (II) mutual fund underperformers. I write this after suggestions on twitter and by Kunal Lal. The first step is to define underperformance. This is possible only if the right category of mutual funds is first selected for investment….
Continue reading →Diversification refers to the simple common sense, ‘not to rely too much on one entity’. In this post, I discuss simple ways to build a diversified portfolio using mutual funds. The main purpose of diversification is to minimise losses, or rather the volatility in the portfolio value. This implies reducing exposure to an asset class…
Continue reading →Suppose you had invested in a mid-cap fund, say SBI emerging business from Sep 2010. Here is a tool with which you can compare the current performance of the fund with all other funds in the mid-cap category and its benchmark. I am not a fan of peer comparison after investing a mutual fund. Many other are….
Continue reading →If I choose a fund with a solid track record, what are the chances that it would deliver in future? Does past performance matter? This is a question on the minds of most mutual fund investors. Let us try and answer this question using annual returns of all diversified equity funds from Value Research. This…
Continue reading →The correlation between mutual fund returns and the upside/downside capture ratios is discussed using Mid-cap mutual funds. It is no secret that I am a fan of the downside capture as a simple means of measuring downside protection, selecting and reviewing mutual funds. In this post, the recently obtained downside Capture Ratio of all Mid-cap Equity…
Continue reading →Although it has limited technical utility, the standard deviation is probably the simplest measure of understanding investment risk. Therefore, it has great practical value when it comes to ‘product positioning’ as the fund industry calls it. ‘Where does a given fund fall in the risk vs reward map?’. AMC often given a product positioning risk vs…
Continue reading →Equity savings funds are the latest type of asset allocation mutual funds introduced first in late 2014 when the government made the duration for debt mutual fund capital gains to be classified as ‘long-term’ from 1-year to 3-years. Equity savings funds are basically arbitrage+equity+ debt funds. They would hold a minimum of 65% equity (most…
Continue reading →The start of the financial year is the best time to plan for saving tax. For those who recognise the importance of tagging tax saving instruments with long-term financial goal portfolios, there is not much to do! Linking tax planning with goals is a one-time affair and all it needs is investing and review. In…
Continue reading →Any keen follower of personal finance space would have encountered their fair share of ‘why you should invest in equity?’ articles and ‘why equity alone is capable of beating inflation over the long-term’ arguments. Things have come to such an end that fixed income investors are considered as not being financial literate. This kind of…
Continue reading →Why do people time the market? That is, why do they enter and exit the market based on certain signals (moving averages, PE etc.)? Is it for getting better returns? Or is it for getting risk adjusted returns? This is a poll I created in Facebook group Asan Ideas for Wealth. As expected, a majority…
Continue reading →If we ‘hold’ equity for the ‘long term’ are we assured of beating inflation with a real return? Will equity beat all other asset classes if we wait long enough? Will long-term equity investing always be successful? Equity as an asset class is sold to investors with an ‘yes’ to such questions. Sold either directly or…
Continue reading →A little over two years ago, an automated mutual fund & financial goal tracker was released. It was made with extensive beta testing by readers and is reasonably popular despite the availability of user-friendly online trackers. Update: This file does not work anymore since the historical NAV download from AMFI has been discontinued. I am working on a…
Continue reading →This is a triple update announcement – to two rolling returns calculators and to the Google spreadsheet for tracking financial independence. First two updates: The mutual fund lump sum and SIP rolling returns calculators have been updated with additional benchmarks. Rolling returns calculators provide a simple, easy to understand visual representation of how consistently a…
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